ApeCoin (APE) price analysis: The rally may soon hit a wall

ApeCoin’s rally could cool down in the near term

BORED APE NFT digital art collection seen on tablet screen placed on 100 dollar bills                                 
The US fund manager Grayscale Investments has announced that it is adding ApeCoin to its list of assets under consideration – Photo: Alamy
                                

The crypto markets are on a recovery path and ApeCoin (APE) has also participated in the up-move. The bulls are attempting to build upon APE’s rally above $6 as of 20 July 2022.

ApeCoin’s price received a boost after  he creator of Bored Ape Yacht Club (BAYC, Yuga Labs, decided to open its Otherside metaverse to selected third-party developers and users who had bought “Otherdeeds” (digital land deeds).

After the end of the demo, Yuga Labs released a litepaper “designed to communicate and explain principles of the platform, capabilities of its developers, and possibilities for community co-creation.”

In other news, the  US fund manager Grayscale Investments announced that it is adding ApeCoin to its list of assets under consideration. This list includes various possible candidates that may become a part of future investment products.

The non-fungible token (NFT) space witnessed a slowdown in 2022. According to a report by NonFungible, NFT sales plunged 47% globally in Q1 2022 compared to Q4 2021. However, a positive sign is that the Bored Ape Yacht Club dethroned CryptoPunks as the most active project, with $1.2bn traded in the first quarter.

With the improving sentiment in the crypto sector, could NFT sales pick up? Could ApeCoin go up? Read the APE price analysis to find out.

APE weekly chart
APE weekly chart – Credit: Currency.com

ApeCoin technical analysis: Weekly chart

APE’s price fell from $27.60 in April to $3.06 in June, a  more than 88% fall in a short time. Lower levels attracted buying and the APE/USD pair has started a recovery. The pair could attempt a rally to the 38.2% Fibonacci retracement level of $8.81. This level is likely to attract strong selling by the bears.

If the price turns down from $8.81, it will suggest that bears remain in command. The sellers will then make another attempt to pull the price toward $3.06. The next dip toward $3.06 will confirm a bottom.

Usually, after a sharp fall, the price remains stuck in a range before starting a trending move. The bears will have to sink the pair below $3.06 to resume the downtrend. On the other hand, buyers will have to drive the price above $8.81 to open the doors for a rally to the 50% retracement level of $10.34.

APE daily chart
APE daily chart – Credit: Currency.com

ApeCoin technical analysis: Daily chart

APE’s price has started a relief rally, which could carry it to $7.22. The bears are likely to defend this level aggressively. If the price turns down from this level, the pair could again drop toward $4 and remain stuck in a range for a few days.

The relative strength index (RSI) is close to overbought territory, signalling that bulls have the upper hand. If buyers drive the price above $7.22, the pair could rise to $9.13. This level could again act as a major hurdle for the bulls.

If the price turns down from $9.13 but does not drop below $7.22, it will indicate that the sentiment has turned positive and traders are buying the dips. That could increase the possibility of a break above $9.13.

ApeCoin: Buy or sell this week?

ApeCoin could face stiff resistance at $7.22. ApeCoin's price analysis suggests that the pair could spend some time in a range between $7.22 and $4. Alternatively, a rise above $7.22 could open the doors for a rally to $9.13.

The views and opinions expressed in the article are those of the author and do not constitute trading advice. Trading and investing involve substantial risks and you should do your own research or contact your financial adviser before arriving at a decision.

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