SAND holders could witness a profit-seeking opportunity, only if…

SANDUSDT 2022 02 24 18 49 02

The November rally bagged in staggering gains as SAND attained its ATH on 25 November. But since then, it has been in a retracement phase as it depreciated in a descending channel (yellow).

Subsequently, a forceful close below its Point of Control (red) would position SAND for the test of $2.2-support before the bulls attempt a rally toward the $2.7-$3.2 range. At press time, SAND traded at $2.7036, down by 16.5% in the last 24 hours.

SAND Daily Chart

Source: TradingView, SAND/USDT

Since its ATH, the alt has declined by over 69% and gravitated towards its November lows on 24 February. During this phase, SAND fell below its 200 EMA (green) for the first time since July 2021 while flipping its eight-month trendline (white, dashed) support to resistance. Historically it showed a strong revival from the above trendline, but the recent sell-offs have strongly established a bearish edge.

The downfall led the coin to lose the crucial $2.8-mark that reaffirmed the vigor of the current downtrend. As a result, it now hovered around its four-month Point of Control (POC, red) at the $2.7-level. Considering the overall sentiment and the technical indications, further sell-offs would find a testing floor near the $2.2-zone. 

This zone also coincided with the lower trendline of its long-term down-channel. A potential reversal from this level would brace SAND for friction between the buyers and sellers at its Point of Control before testing the $3.2-resistance.

Rationale

Capture 21 scaled

Source: TradingView, SAND/USDT

The RSI was on the brink of the oversold mark and undeniably favored the sellers. The 27-30 range support could keep up the revival hopes alive towards the $3.2-level in the days to come. Since the past month, the price has been marking lower troughs while RSI has been on a slight uptrend. So any revival/green candlestick would affirm a bullish divergence from here on.

Like RSI, the OBV confirmed the slight uptrend while the price pulled back. But -DI still looked north, justifying the near-term bearish movements before a reversal.

Conclusion

While the readings on the RSI and OBV potentially hint at stalling the sell-off situation, the buyers still needed to step in and confirm these divergences. Keeping in mind the current selling spree, a touchdown toward $2.2 before a reversal should not be a surprise.  

Besides, the alt shares an 80% 30-day correlation with the king coin. Thus, keeping an eye on Bitcoin’s movement would be vital to complement these technical factors.