IOTA continues to consolidate in the charts, moving inside a rising wedge against bitcoin and a symmetrical triangle to the dollar. Price is currently testing the wedge support versus bitcoin and could be due for a move lower.
However, the 100 SMA is safely above the longer-term 200 SMA on the 1-hour time frame so the path of least resistance is to the upside. In addition, these moving averages line up with the bottom of the wedge to add to its strength as support.
Stochastic is turning lower without even hitting overbought levels to show that selling pressure is returning. This could lead to a downside break from the 0.00011 support and a drop of around 0.00005 or the same height as the wedge formation. RSI, on the other hand, appears to be heading north to reflect the presence of bullish momentum.
Bitcoin has reached new highs recently and continues to enjoy market support as its rivals bitcoin cash and bitcoin gold are experiencing plenty of setbacks. Anticipation for the launch of CME bitcoin futures is also in play, although investors are starting to worry that it could be delayed until next year.
Meanwhile, IOTA is also testing its consolidation support to the dollar, although a break lower could still encounter plenty of nearby support zones. The rising trend line connecting the lows since the start of the month is very much intact and lines up with the 200 SMA dynamic inflection point.
The 100 SMA is above the longer-term 200 SMA to confirm that the path of least resistance is to the upside. This signals that IOTA could still recover back to its highs near parity sooner or later.
Stochastic is also pointing down, though, so sellers could take the upper hand for a bit before allowing the longer-term climb to resume. RSI is on middle ground to signal further consolidation.
The dollar has weakened significantly against most of its peers on weakening inflation forecasts, with Yellen and many FOMC participants worried that price levels could run below the 2% target longer than previously anticipated.