ONDO reclaims $0.40 but the move has a credibility problem

Ondo Finance entered June on the good side of a brutal 5-week grind. After reaching a high just under $0.48 on May 27, the token had sold off consistently in lower highs with increasing volume and acceleration and bottomed twice at $0.34-0.35 before any material buying appeared. The current $0.42 print is a 23 percent rally off the low and also the precise point where it becomes interesting.

What does the chart depict

ONDO reclaims <img decoding= — **Source: Tradingview**

ONDO reclaims $0.40 but the move has a credibility problem — **Source: Tradingview**

The ONDO chart is pointing out a double bottom clearly on the 4-hour frame. The market participants have noticed the test of the red liquidity support region and this has happened twice without an obvious undercut (one on May 28th, the second early June) and the bounce off the second test had gone through the candle bodies more than that off the first.

Price has broken through the mid-range at $0.40, and now seems to be targeting a horizontal level that has halted rallies in mid-May and once more surpassing that around $0.40-$0.42.

EMA200 on daily is at $0.40 and at the time of writing, the price is trading just above it. This region has acted as resistance on the move down. As the level becomes important, it is now being tested from below on the recovery. The ultimate trend will depend on the multi-daily time frame. In the case of a daily close at $0.41-$0.42 with a stall, it is different from pushing through it with high volume. We have not yet got a close on the session.

MACD on the daily is signaling on the caution side for the continuation argument. The line was at 0.00773 to signal’s 0.01498 and this results in a -0.00725 histogram. Whilst it can be constructively read as a converging range, momentum has not flipped. Those market participants expecting to be on the side of a clean move through $0.44 are therefore expecting confirmation that isn’t there. RSI at 54 correctly indicates the market is not near the situation that should be faded or oversold to buy. The current situation and market momentum indicators look to be in a phase of a market waiting.

Fibonacci levels shows damage

Fibonacci retracements of the $0.28 swing low and $0.48 swing high place the 23.6 percent at $0.43. This is the first clean overhead resistance beyond that region. Beneath that, the 38.2 level currently lies at $0.40 and is virtually aligned with the EMA200. There is also a daily pivot at $0.38, creating a potential support cluster that must break before the rally narrative would be called into question. The retracement level of 61.8 standing at $0.36 is above the double bottom structure; a drop to that level would put price back within the consolidation range. According to analysis, it is quite likely to lead to a second round of selling by those who caught the rebound.

The short SMAs are positioned near the zones of $0.37-0.38 and this is just under the present price. EMA7 and EMA30 are in the same range as each other. The moving average view is not pointing out towards a strong trend. Instead, it depicts a coil pattern after trending, which means the upcoming move expansion carries great importance in depicting the next move.

The blue box on the chart in the $0.48-$0.49 zone shows the prior swing high. In order to get there, we’d have to first get above $0.43 and then, following any retrace, respect the $0.40-$0.41 area as support (instead of breaking back into the range). A break and close above $0.44 and a MACD crossover would offer a near-term recalibration to the chart.

In case there is any recovery read that is invalidated, it will close under the level of $0.38 on the 4-hour time frame. This move takes the price below the pivot, the SMA30, and the EMA7 all at once, making $0.34-$0.35 the next and important level the market participants should keep an eye on.