XEM has been losing considerable value in recent weeks. Looking at specifically XEM/USDT, the price has dropped down to levels that have not been seen before. Despite the general softening of market wide conditions for all cryptocurrencies, there is also some clear under-performance for XEM. This is being attributed to growing concerns across the crypto community on the NEM foundation and their stability.
In terms of price behavior, there has been a recurring pattern for NEM’s XEM since the start of 2019. XEM/USDT has mostly been range-bound trading, stuck within narrow forms of price movement. Range-blocks that essentially form are subject to breakouts to the downside, which has been observed. The price ranges and then sees an explosive move south: this was been observed throughout January.
NEM Foundation Providing Further Clarity
Just a few days ago, the NEM Foundation released an update regarding its initial message to the NEM community that was issued on 31stJanuary. They had previously noted their budget was running low on XEM and fiat, in addition to changing its internal structure with plans of layoffs.
The further update pushed out by the foundation was to clarify on some of their statement, which was getting very much misconstrued. NEM noted that they have applied for new funding with a benture capitalist and are anticipating increased liquidity in around a month. They also confirmed the layoffs, not workers getting fired, asserting that there is hope that everything will be back on course.
Technical Review – XEM/USDT
XEM/USDT most recently made a breakout to the downside from a range-block formation, which had formed between 12-26th January. The breach from the bears took place on 27th January, inviting another wave of selling pressure. A drop of over 30% has been shaved off the value, following this most recent fall south.
It is also worth noting a huge spike in selling volumes can be seen via the daily chart view. This is the biggest flow of volume seen since November 2018, when XEM saw decent upside. This came on the back of Coincheck announcing that they would once again facilitate trading of the XEM. Earlier in the year, a hack at the exchange led to a more than half-billion dollars in tokens being stolen and systematically laundered through other exchanges.
There aren’t any further technical reference points of suppor with this current pace of downside momentum being observed. The price for both XEM/USDT and XEM/BTC are trading in unknown territory. It is difficult to know when the downside pressure is going to call it a day, which just promotes further FUD, with the lack of technical perspective.
Disclaimer: The author owns bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.
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