Onyxcoin ($XCN) has witnessed a dramatic decline in value over the past month, with its price falling nearly 50%. Currently trading at $0.0090, the altcoin's recent performance has raised concerns among investors, as it approaches the potential formation of a Death Cross — a bearish technical signal that could indicate further downside.
Investor Sentiment Deteriorates as MVRV Metric Hits 4-Month Low
The MVRV Long/Short Difference, an important indicator of investor sentiment, has dropped to its lowest level in four months. This suggests that long-term holders (LTHs) are experiencing a reduction in profitability, as the metric hovers just above the neutral zero line. Should this metric continue to decline and enter negative territory, it would signal that short-term holders (STHs) are currently profiting, further intensifying the bearish sentiment surrounding Onyxcoin.
The drop in the MVRV Long/Short Difference also highlights waning confidence from long-term holders, who have previously been the key supporters of the asset. As these holders face diminishing profitability, the likelihood of increased selling pressure grows, which could exacerbate the downtrend.
Technical Indicators Point to Death Cross Formation
Onyxcoin’s technical analysis is showing further signs of trouble, with the Exponential Moving Averages (EMAs) nearing a potential Death Cross. This event occurs when the 200-day EMA crosses below the 50-day EMA, signaling a shift in market sentiment towards the downside. If the downtrend continues, the likelihood of this crossover increases, which could lead to further price declines as selling pressure takes over.
A Death Cross is often regarded as a bearish signal, typically indicating sustained downward momentum and a continuation of the ongoing negative trend. As concerns grow, investors are monitoring the formation of this technical pattern closely, as its confirmation could lead to a substantial correction in Onyxcoin's price.
Price Forecast: Support Levels Under Pressure
Currently, Onyxcoin’s price stands at $0.0090, reflecting a sharp 50% drop over the last month. If the bearish trend persists, the altcoin may test the next support level at $0.0083, potentially extending its losses. Should this support fail to hold, Onyxcoin could face a deeper decline, with a possible drop to the $0.0070 level, marking another significant leg down in its struggle to regain upward momentum.
Conversely, if Onyxcoin manages to reverse its downward trend and break through the $0.0100 resistance level, it could see a potential rally toward $0.0120, potentially invalidating the current bearish outlook. This would require a shift in market sentiment, driven by a significant uptick in buying pressure, which may occur if broader market conditions improve.
Conclusion
The outlook for Onyxcoin remains bearish, with a number of technical indicators and sentiment metrics signaling further downside risk. Investors will need to closely monitor the formation of the Death Cross and key support levels to gauge the potential for continued declines. However, a reversal in trend could still be possible, provided there is a shift in investor sentiment and favorable market conditions.
