Jul 22, 2022 02:30AM ET
By: AnalysisWatch
Investors are looking at Monero (MXR) as a good investment option, especially after its recent rally. The altcoin has seen a nice bull run since its last local low, but at the time of writing, MXR has been showing some signs of weakness.
On July 20, the cryptocurrency was trading at $152.80, but early on July 21, the price dropped to $146.30. At the moment, MXR is worth around $151.56 after a 5.52% increase in price over the past 24 hours.
The altcoin's price action suggests that bull strength is waning. MXR's price slightly crossed the Fibonacci retracement line before showing some signs of weakness. This came after the price crossed the 50-day moving average for the first time since May.
Despite MXR's latest rally, the cryptocurrency is not yet overbought. This means there could be some wiggle room for the bulls before crypto enters the RSI overbought zone. However, this can only happen if there is enough volume to push the price higher.
Fortunately, MXR volume hit a four-week high over the past day, but despite this, whale supplies demonstrated an unfavorable outlook.
Most of MXR's price action is also controlled by the retail segment, which can support strong short-term price rallies, but is almost always followed by a bearish pullback if whales are unable to provide sufficient support.
Another possible explanation for the recent Monero rally is active project development. This could be a good thing for the cryptocurrency, as investors may be encouraged to hold their MXR holdings, thus softening the blow of a sharp pullback.
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