In our previous article we hypothesized that both Peercoin and Namecoin are in rally mode. Shortly after that article however we got a sharp correction in prices, which briefly broke below some important support levels (more on this below).
Peercoin Resumes Uptrend
The last two weeks saw a lot of volatility in PPC prices. First we fell to a low of $0.211 on January 7th, briefly breaking below the $0.223 level identified last week as a potential trend ender. But the break wasn’t decisive and if you take a look at the daily chart you can see that prices never closed below this level. Furthermore the duration of the trip below $0.223 was short, lasting only a few hours.
Because of the above we can say that the uptrend in PPC/USD is still in play. This week Peercoin hit new multi-month highs at $0.313. We have since fallen back somewhat to $0.282. On the longer-term charts (both weekly and monthly) PPC is in neutral mode.
On the way up, resistance can be found at former swing high at $0.29 and the 30 cents round level. But a stronger level then these two, at least on FXOpen, may be the $0.313 swing high reached few days ago. A breakout above here could intensify the gains.
On the lower end, a break below the $0.225 swing low is needed to end the current rally. As always, we are looking for a clean and decisive break, not a short spike below the level. A move below this month’s low at $0.211 would start a new PPC downtrend.
Namecoin Rally Ends
Namecoin prices initially followed a very similar pattern to PPC. Here too initially there was a sharp sell-off 12 days ago, with the pair bottoming out at $0.194. The level noted as a potential trend stopper in our previous NMC article was the $0.208 swing low. Clearly prices broke this level but they’ve failed to remain below it for long. In fact on the hourly chart we didn’t get a single candle close below $0.208.
Here is where the similarities with Peercoin end. Unlike PPC, which recovered sharply after the initial decline, NMC failed to do so and lost the upward momentum entirely. We are now back in ‘no-mans’ land.
To start a new downtrend, the bears will have to push NMC/USD below $0.194 swing low. To resume the uptrend, prices will have to break above the 30 cents round figure. The longer-term charts for Namecoin are mixed. While the weekly is undecided, the monthly is still bearish.