Dash (DASH) Rallies on Strength in the Privacy Sector: Breakout Still Uncertain

Dash (DASH) has experienced a significant rally, rising by 20.48% over the past 24 hours, fueled by increased interest in the privacy sector. Despite this surge, the potential for a breakout past key resistance levels remains questionable.

Key Takeaways

Dash (DASH) surged 20.48% within a day.
Open Interest for DASH saw a 55% increase.
Enthusiasm in the privacy sector, particularly following Monero's all-time highs, contributed to DASH's rally.
A major resistance level around $50 could hinder further price increases.
Traders are advised to consider taking profits amidst uncertainty.

DASH spikes on privacy sector strength - A breakout is still uncertain

Examining Long-Term Trends for Dash

Dash 3-day Chart

Source: DASH/USDT on TradingView

DASH's price charts reveal that a critical resistance level at $50 has consistently posed challenges for buyers since early December. As of now, prices for the privacy token are nearing this resistance zone again. An earlier report from AMBCrypto indicated that a rise above the $50-$52 range appeared unlikely for early January. The altcoin seems to lack adequate buying pressure to surpass this essential supply area.

While the On-Balance Volume (OBV) has been on the rise over the past month, trading volume has remained consistently lower than the 20-period moving average. This indicates a cautious approach for eager bulls who might want to temper their expectations until a clearer breakout occurs in the market.

Is a Bullish Breakout on the Horizon?

Breaking past the $50-$52 resistance levels is feasible, yet it carries significant risks. The primary reasons include low trading volume on higher timeframe charts and a bearish sentiment following previous declines below $40 in recent months.

Traders’ Recommendations: Consider Taking Profits

The combination of a negative Funding Rate, an increase in Open Interest, and a rise in spot Cumulative Volume Delta (CVD) suggests a potential short squeeze, which might push prices towards $52 or higher. A daily close above $53.42 would signal a shift in momentum, indicating a possible bullish bias for swing traders.

However, until such a breakout occurs, traders should remain cautious due to the likelihood of heightened volatility. The final week of December exhibited similar conditions - high Open Interest, negative funding, and testing of the $50 supply zone - but the expected breakout did not materialize, leaving the current situation uncertain as well.

Conclusion

Disclaimer: The information provided in this article is for informational purposes only and should not be considered financial, investment, or trading advice. It solely reflects the author's opinion.