The Decentraland (MANA) price is trading inside a corrective pattern from which it could break down.
The Decentraland price has increased rapidly since the beginning of the year, leading to a high of $0.82 on Jan. 27. The movement caused a breakout from a long-term descending resistance line that had previously been in place since May 2022.
If the increase continues, the next closest resistance area would be at an average price of $1.10. The area has not been reached since Aug. (red icon).
However, despite the bullish price action, the daily RSI casts doubt on the possibility of the upward movement continuing. This is because the indicator has generated a significant amount of bearish divergence (green line), falling below 70 in the process. Both of these are considered signs of a bearish trend.
As a result, the most likely future movement is a drop to validate the confluence of support levels at $0.55, created by the 0.5 Fib retracement support level and the resistance line from which the digital asset previously broke out.
MANA/USDT Daily Chart. Source: TradingView
Decentraland Price Prediction for Feb: Correction Expected Before Uptrend Resumes
The technical analysis from the short-term six-hour chart provides a Decentraland price prediction for Feb., aligning with the readings from the daily time frame. The reasons for this are twofold:
Firstly, the MANA price has traded inside an ascending parallel channel since Jan. 16. Such channels usually contain corrective movements. Therefore, a breakdown from it would be the most likely scenario.
Next, similar to the daily time frame, the six-hour RSI has generated bearish divergence (green line). As a result, a breakdown from the channel is the most likely scenario.
If that happens, the Decentraland price is expected to reach the $0.55 support area. Besides being the 0.5 Fib retracement support level and coinciding with the previously outlined resistance line, the $0.55 level is also a horizontal support area.
Due to this confluence of support levels, a bounce once it reaches it is the most likely scenario.
MANA/USDT Six-Hour Chart. Source: TradingView
To conclude, the most likely Decentraland price prediction for Feb. is a breakdown from the short-term ascending parallel channel, followed by a drop toward $0.55. Afterward, the upward movement could continue.
A breakout from the channel would invalidate this bearish Decentraland price forecast. In this case, the MANA price would be expected to increase toward $1.10.
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Source : Decentraland (MANA) Price Poised to Dip Further in Search of Support
