Privacy-focused cryptocurrency Dash (DASH) is now facing its Waterloo as the technical outlook becomes increasingly unfavorable for the asset.
The cryptocurrency, after staging an abnormal run that sent it soaring 427% to $150 after the October 10 liquidation event, has since slipped steadily and is now poised to completely erase those gains if it falls below $28.
Over the past 24 hours, this outlook has moved closer to reality after a 13% drop, and AMBCrypto assesses in this article whether the drop is likely to materialize.
DASH sits at a support level after abandoning its entire rally
DASH is only one technical support level away from wiping out all gains accumulated during this period.
Support at $29.63 remains key to the price structure, sitting just above the $28 mark, which would confirm that DASH has given up its entire October rally. The last time DASH reached this level, it triggered a significant rally in the market.
A break of this support, confirmed by a weaker candlestick formation, would underline the strength of the bears. Such a breakout could take DASH towards $23, the next closest support below current prices.
However, DASH could instead consolidate in a range between $29 and $37, just as it did during the period marked by the oval on the chart.
Momentum Indicators Indicate Bears Taking Control of DASH
Momentum-based indicators suggest that bears are positioned to intervene and force the price lower, and the Parabolic Stop and Reverse (SAR) demonstrates this case most directly.
The Parabolic SAR evaluates the trend of an asset through the placement of its points. Points above the price indicate a downward trend, while points below indicate an upward trend.
Currently, the points are above price, indicating that sellers have the upper hand and could significantly weigh on DASH. The Chaikin money flow only deepens these already fragile prospects.
The Chaikin Money Flow fell into negative territory, posting a reading of -0.10 and showing that sales volume is now dominating the market and clouding the outlook.
If these indicators continue to follow bearish pressure, DASH will likely continue its downward trend.
Perpetual Market Data Signals Growing Downside Risk for DASH
Analyzing stock market activity, particularly funding rate data, remains critical to understanding the broader pattern and tracking how investor capital is flowing through the market.
The funding rate has turned deeply negative, with the data at -0.0726%. This implies that the majority of the $41.71 million worth of DASH perpetual contracts are tilted toward the sell side, and this cumulative pressure exposes DASH to greater downside risk.
Currently, holding a short contract is more profitable than holding a long contract. Liquidations wiped out about $698,000 from long positions in the past 24 hours, compared to just $39,620 from short positions.
Final Summary
- DASH fell 13% and is currently testing the critical support level of $29; a breakdown could reveal a move towards $23.
- A parabolic SAR above price, CMF at -0.10, and negative funding rates highlight strong bearish control and increasing short dominance.
