It is also a bearish indication that last week ended with a potentially bullish hammer candlestick pattern on the weekly chart and a closing price in the top third of the week’s price range. While this week ended near the lows of last week. In other words, there is a failed bullish pattern contributing to bearish sentiment as well.
Weekly Trend Support
Despite the bearish indications, there is potentially significant support not too much lower. A break below last week’s low of $3.23 shows the potential to test support around a slightly lower uptrend line that connects to the April swing low. It looks like $3.28 is where the trendline currently sits. Not insignificantly, it is joined by the 50-Week MA, now at $3.24. The area around the 50-Week line was successfully tested as support twice since the March peak and should do so again. Nonetheless, a continuation of the decline below last week’s low triggers a bear flag pattern and therefore bearish momentum could accelerate.
Trendline Support
Two lower targets become possible if a sustained breakdown below the lower rising trendline triggers. There is a 78.6% Fibonacci retracement at $3.14, which is confirmed by a 78.6% target for a falling ABCD pattern (purple). However, the primary initial target from the ABCD pattern is $2.97. The significance of that price area is increased by an AVWAP line (light blue) begun from the February 2024 trend low. It shows support nearby at $2.95. Notice that the AVWAP very clearly marked support at the recent trend low in April and therefore may do so again.
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