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According to Egrag, VeChain (VET) recently made its first attempt to break out from a descending channel it is currently stuck in.
Egrag, a notable crypto analyst, has identified an attractive buy opportunity for VeChain (VET) in the weekly timeframe. The opportunity came up after VET’s recent decline below the $0.02 price territory after facing resistance to a bullish breakout.
The Descending Channel
In his latest VET analysis, Egrag first called attention to VeChain’s attempt to break out of a descending channel it has been trapped in since it fell from its all-time high of $0.2782 in April 2021. Being caught in a descending channel means that VET has persistently recorded lower highs and lower lows since then.
#VET What's Next:
This is #VET fifth attempt to break-out from the Descending Channel. The more it fails the closer the break.
Double bottom is plausible and probable but the wick to 0.007c is within the realm of possibilities. #VET will unlock ur financial chains. https://t.co/3WUWOi8Gnm pic.twitter.com/1r6YRWk8VD
— EGRAG CRYPTO (@egragcrypto) May 14, 2023
The analyst highlighted that VET had made several attempts to break out of this descending channel but had failed, with the latest being the fifth attempt. Egrag believes that each failed attempt brings VET closer to a potential breakout from the channel.
He further noted that the asset could form a double bottom, a technical pattern where the price reaches a low point twice, with a slight rebound in between. This pattern often indicates a trend reversal and a potential price increase.
According to Egrag, this double bottom pattern could form at the $0.015 price point or the $0.007 zone in the event of a much deeper decline. The last time VET saw this price was in June 2020.
Notably, the analyst has set up three targets leading to an ultimate price of $1.66 once VET breaks out of the descending channel. The first target sits at $0.0648, with the second target positioned at $0.11649. The ultimate and third target stands at $1.66.
It bears mentioning that VET observed a similar pattern from July 2018. The asset got trapped in a similar descending channel from 2018 until it staged a breakout in 2020, leading to its all-time high in April 2021. Egrag believes a repetition will occur.
VET Slips into the Buy Zone
However, following the resistance met at the fifth attempt to break out from the channel, VET plummeted into Egrag’s buy zone, representing a territory that presents an attractive buy opportunity for the asset.
This is the asset’s second time visiting the buy zone this year. The asset slipped into the zone in December 2022 and remained within it until January of this year. Notably, the buy zone sits between the $0.012 and the $0.025 territories.
Egrag highlighted the possibility of VET slipping further into the “Ultimate Buy Zone” which is between $0.006 and $0.012. The analyst stressed that his audience should know what to do should that eventually occur. “VET will unlock ur financial chains,” he remarked. VET is currently trading for $0.01947, up 1.35% in the past 24 hours.
Meanwhile, the VeChain Foundation continues to introduce measures to bolster the asset’s real-world utility. As previously reported by the Crypto Basic, the Foundation launched the VeWorld self-custody wallet in February, and unveiled a feature to eliminate gas fees on the wallet last month.