STG's breakout rally stalls at $0.45: What comes next?

STG is changing hands at $0.3981 on Binance at the time of writing. The asset has been providing an upside move of 16.34 percent for the day, 51.59 percent for the week, and 65.10 percent for the month. The daily candle opened the day at $0.3424, made an intraday high up to $0.4536, and closed away from the high of $0.4536. This $0.0555 upper wick is not noise. This candle is the first firm indication that a supply zone is defending above the $0.43 level.

STG's breakout rally stalls at <img decoding= — **Source: Tradingview**

STG's breakout rally stalls at $0.45: What comes next? — **Source: Tradingview**

The above daily chart points out the noteworthy part of stargate finance(STG). The asset had a long month in May, grinding between $0.20 and $0.28 and building support levels in the timespan of 4 weeks of horizontal compression after dropping from $0.29 down to $0.15 at the end of April. The June 1 candle has broken through it all and come up with a move from beneath $0.20 to a $0.41 intraday high on massive volume, taking back the $0.2813 green level that had previously acted as a price cap in April and range resistance all May. Following the reclaim, the old resistance is now flipped into support.

After that initial rally back from June, STG saw some correction. Its close on June 5 was at $0.223, fully below the important zone of $0.2813. The STG buyers re-entered close to the zone of $0.26069 on June 9 and following today’s session, it has just crossed over $0.39. Price has turned back to green twice in two weeks. Each time is on a double candle with wicks at the top. It’s the double wick at or above $0.43 where the structural narrative is located.

Liquidity areas to keep an eye on

The blue band marked on the daily chart is highlighted at the price points of $0.42 – $0.44 and represents resting sell orders that soaked up both the June 1 push and today’s price action.

The wick above 0.4536 scooped liquidity above the previous day’s high, then retreated and closed below it. This can be termed as more of a fake breakout or failed breakout. Buyers who were expecting the bullish move to be in continuation made their entry for long on the break above $0.43 and are now underwater on their positions. If it continues to hold and trade in the $0.38 – $0.40 region for another day, these stops will then likely be utilized in order to power the leg below it.

What do the key support levels and indicators suggest?

The Fibonacci structure continues to give a more expected scenario that the asset might follow. The recent bounce at the green support area has given some confirmation on the $0.1498-$0.4124 swing’s 50 percent retracement at $0.2811. The 23.6 percent retracement point at the level of $0.3504 acts as the first important support level below the current price. Any breakdown of this relative asset under $0.3500 on the daily close could come up with a target back at $0.2813. In the worst case for the bulls, if STG breaks under $0.2813 then it could provide targets at the previous consolidation base at $0.1969, where the May low was located.

The broader trend is still leaning on the bullish side, but momentum is looking more stretched. Price is being traded well above its significant moving averages and this highlights how quickly the token has given the spike to the upside.

The momentum indicators like MACD remained positive at the time of writing with a recent bullish crossover, while RSI 7 can be called more of an overbought category, which is standing at 70.44 suggests the move is nearing overbought territory. The RSI 14 figure is standing at 64.30 and shows that it has a lot more room for upside, but the divergence among these readings points to more strength in the shorter time frame rather than a long-term continuation of the bullish trend.

Liquidity areas to keep an eye on

What do the key support levels and indicators suggest?

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