Neo fell again on Monday to pierce the $20 level. The market continues to go back and forth, and I think at this point we are trying to form a longer-term consolidation area. However, it is worth noting that the market is going to have to pay close attention to crypto markets in general, as we have seen quite a bit of noisy behavior in the bigger coins.
Remember, more than anything else, larger markets will have a major influence on what happens in this market. Neo continues to look at the $20 area as significant support, extending all the way down to the $17 level. In other words, it would not be surprising at all to see a little bit of a bounce, but at this point in time, it still will struggle to have a longer-term move to the upside. It appears that Neo is going to continue to pay close attention to Bitcoin and Ethereum, both of which will drive the overall markets in general.
The 50-day EMA currently sits at the $23 level and is drifting a bit lower. Beyond that, we also have a lot of resistance at the $26 level, so I do think that there are a couple of barriers that you need to pay close attention to. If we get a bit of a bounce from here, a short-term trader may be able to take advantage of these levels, but I would not look for too much beyond that, at least not until we get more money flowing into riskier assets such as Neo.
One thing that a lot of crypto traders tend to forget is that the other half of the equation is the US dollar. The US dollar has been like a wrecking ball against most things, crypto included. I think at best you are looking at a back-and-forth type of market, with the potential of a major breakdown. If we were to break below the $17 level, it is likely that the market will continue to drop rather hard, perhaps showing a potential collapse. There are a lot of crypto markets out there right now that look threatened to say the least, so pay attention to the market on the whole to get an idea as to where Neo could go.
