Can the Bulls Keep Price Action Above $45 to Prevent the XMR Market from Turning Bearish?

  • 4.3% of the total Monero mined has come from illicit mining malware.
  • Cyber criminals are using the privacy-focused cryptocurrency for illegal purposes.
  • Support moving forward: $48.66, $46.22, $42.75, $41.82, $40.68, $38.31.
  • Resistance moving forward:$51.10, $54.12, $58.22, $60, $67.01, $69.21, $70.21, $74.82

Latest Monero News

Monero is a privacy-focused cryptocurrency which allows users to transfer funds anonymously through the network.

As cryptocurrencies like Bitcoin are based on a public ledger, transactions can usually be tracked back to their owners through blockchain forensics. Monero combats this by shielding the important aspects of the blockchain from public view so forensic experts cannot track the transactions.

However, this anonymous nature has also given birth to a new wave of cyber crime. The latest incident involves a wife of a Norwegian millionaire, Tom Hagan, who has been kidnapped from her home and has been missing since October 31, 2018.

Tom Hagan, the 172nd richest man in Norway with a net worth of circa $200 million, had returned home to an empty house to find a note demanding a ransom totaling 9 million Euros to be paid in the cryptocurrency Monero for the release of his wife.

The note mentioned that his wife, Anne-Elizabeth Falkevik, would be murdered if the police were to get involved.

Recent research by Universidad Carlos III de Madrid & King’s College London has uncovered that cyber criminals have used mining malware to mine over 4.3% of the entire supply of Monero through illicit mining.

The 4.4 million malware sampled in the research found that over 1 million of them were malicious miners. The total figure of the Monero mined is estimated to be around $57 million, depending on when the criminals had cashed out. Surprisingly, the malware was found to be mainly distributed through legitimate services such as Dropbox or GitHub.

Let us continue to take a look at the XMR/USD market over the recent period and continue to highlight any potential areas of support and resistance.

XMR Price Analysis

Monero has seen a sharp price decline totaling around 9.28% over the past 24 hours of trading, bringing the current trading price down to around $48.68, at the time of writing.

Monero is now ranked in 13th position as it currently holds a $817 million market cap value. The cryptocurrency has seen a 51.72% price decline over the past 30 days of trading as the 56-month old project now trades at a value that is 90% lower than the all-time high price.

Looking at the 4-hour chart for XMR/USD above, we can see that Monero had continued to trade below our previously identified support at the downside 1.414 Fibonacci Extension level (drawn in purple) priced at $41.82 to reach the yearly low price of $38.31.

After price action had reached this level of support, the market went on to rebound and rally into resistance provided by the bearish .236 Fibonacci Retracement level (drawn in orange) priced at $58.22. This Fibonacci Retracement level is measured from the high seen in November 2018 to the low seen in December 2018.

After hitting the resistance, the market then proceeded to drop slightly below the short-term .618 Fibonacci Retracement level (drawn in green) priced at $46.22, before bouncing higher once again.

XMR/USD fell on January 10, partly due to the BTC/USD price drop, and is now trading at support provided by the short-term .5 Fibonacci Retracement level (drawn in green) priced at $48.66.

Trend: Neutral

Although price action has dropped significantly, the market trading condition is still neutral as price action trades within the confines of the previous swing higher.

For this market to be considered bearish, we would need to see price action break below the $45 handle.

Where is the Support Located Below $48.66?

If the sellers continue to drive price action lower, we can expect further support towards the downside to be located at the short-term .618 Fibonacci Retracement level (drawn in green) priced at $46.22.

Further support located below the $45 handle can then be expected at the short-term .786 and .886 Fibonacci Retracement level (drawn in green), priced at $42.75 and $40.68 respectively.

The final level of support to highlight is located at the 2018 low priced at $38.31.

Where Will the Market Meet Resistance Towards the Upside?

If the bulls manage to regain momentum and push price action higher, we can expect immediate resistance above to be located at the short-term .382 and .236 Fibonacci Retracement levels (drawn in green), priced at $51.10 and $54.12 respectively.

Further resistance above can be expected at the bearish .236 Fibonacci Retracement level (drawn in orange) priced at $58.22.

If the buyers can continue to break above the $60 handle, higher resistance can be located at the short-term 1.272 Fibonacci Extension level (drawn in purple) priced at $67.01. This is followed by the bearish .382 Fibonacci Retracement level (drawn in orange) priced at $69.21.

If the bullish momentum continues above the $70 handle, then further resistance will be located at the short-term 1.414 and 1.618 Fibonacci Extension levels (drawn in purple), priced at $70.21 and $74.82 respectively.

Conclusion

The battle between privacy and security is a heated debate. However, privacy-focused cryptocurrencies do create the ideal breeding grounds for cyber criminals as they are able to remain anonymous and cash out their criminal activities in a secure manner.

It is important to remember that this is not the fault of Monero but just a problem that, unfortunately, comes with the territory.

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