- NEO rebounds after retesting critical support; prepares for gains above $20.
- The bullish outlook will be invalidated if NEO/USD closes the day under the 50 EMA on the 4-hour chart.
NEO has been fostering an uptrend since the Thanksgiving Day crash towards the end of November. December has been yielding for the smart contract token, as it broke the hurdle at $18 and closed in on $20. After confirming support at $18, NEO/USD is preparing for a run-up above $20.
NEO awaits the ultimate liftoff beyond $20
NEO/USD has been trading within the confines of an ascending parallel channel, as illustrated on the 4-hour chart. The uptrend built upon last week’s support at $15 but failed to overcome the channel’s upper boundary resistance.
The cryptocurrency corrected to the lower boundary of the channel and has been holding at this level. An ongoing reversal seems poised to retest the upper border. If the hurdle breaks, NEO could surface above $20 and perhaps embark on a new rally towards $30. For now, the least resistance path is upwards based on the Relative Strength Index’s uptrend.
NEO/USD 4-hour chart
It is worth mentioning that if NEO abandons the uptrend and breaks under the 50 Exponential Moving Average on the 4-hour chart, extended declines will come into the picture to the 200 EMA. The 100 EMA will absorb some of the selling pressure, but this support might not be strong enough to force a turnaround.
NEO/USD 4-hour chart
On the other hand, a bearish outlook will be validated if NEO closes the day under the channel’s lower boundary. Supply for NEO is likely to increase, creating enough volume to slash the gains accrued from the support at $15.
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