Unus Sed Leo (LEO) has not only survived the cryptocurrency market bloodbath in the first half of 2022, but has actually posted significant gainsresisting the great fall of cryptocurrencies.
LEO overtakes the king of cryptocurrencies, Bitcoin
LEO, a utility token used throughout the iFinex ecosystem, ended the first half of 2022 against Bitcoin at 32,793 satoshis, up nearly 300%.
The token also rallied 55% against the US dollar in the same period, hitting $5.8 for the first time since February 2022.. By contrast, Bitcoin (BTC) and Ether (ETH), the top two crypto assets by market cap, fell more than 60% and 70%, respectively.
That has made it the best-performing crypto asset in the top ranks so far in 2022.
What is driving the price of LEO?
The crypto market has lost over $2 trillion from its valuation in the first half of 2022, due to rate hikes, the collapse of Terra, and systemic insolvency issues of major crypto lending platforms and hedge funds. coverage.
The price of LEO also suffered a 25% decline after reaching its all-time high of $8.14 in February 2022. However, it fared better than the rest of the cryptocurrency market, which fell by almost 60% in the same period.
The reason behind this outlier token could be its markedly different attributes compared to other digital assets.
IFinex, the parent company of Bitfinex, launched LEO in 2018 in a private sale round to raise $1 billion. In return, the firm agreed to use 27% of its revenue from the previous month to buy back LEO until all tokens were withdrawn from circulation.
Also, iFinex has promised to buy back LEO tokens using the funds it had lost during the August 2016 Bitfinex hack.
In February 2022, the US Department of Justice recovered 94,000 BTC out of 119,754 BTC. That coincided with LEO rallying to all-time highs in both Bitcoin and dollar-based markets.
Excessive overheating?
LEO’s rally against Bitcoin is at risk of running out of steam as its price divergence widens with momentum.
In detail, LEO price has been making higher lows as its daily Relative Strength Index (RSI) prints lower highs. As a rule of technical analysis, this divergence shows a lack of bullish conviction among traders.
The RSI is also above 70, a traditionally “overbought” zone and a sell indicator.
LEO is now maintaining its bullish bias as it remains above its intermediate support level at 26,220 sats, which coincides with the 0.236 Fib line of the Fibonacci retracement chart drawn from the 4,382 sats low to 32,965 sats high.
A decisive close below 26,220 sats could see LEO see a decline towards the 38.2 Fib line near 22,046 sats, 25% below current price.
Curiously, the level is close to another support level: the 50-day exponential moving average (50-day EMA; the red wave on the chart above).
LEO/USD bearish rejection
The current price rally in LEO saw it briefly close above a critical resistance level around $6.24, as shown in the chart below.
This level was decisive in stopping the bullish attempts of the token between February and April of this year. He again prompted traders to lock in profits on July 1, leaving LEO with a big bullish wick and thus hinting at a bearish rejection.
Recent LEO price trends are littered with bearish rejection candles, including its 57% intraday price rally on Feb 8 that preceded a 28.5% correction at the end of that quarter.
On the contrary, the bullish rejection candle on June 18 led to a 50% price rally, as discussed above.
If the given fractal plays out, then LEO will risk a price pullback to its interim support level of $5.52, which, coincides with the token’s 50-day exponential moving average (50-day EMA; the red wave).. That would mean a modest 9%-10% decline from today’s price.
But if support does not hold, as it did in late April, LEO price risks testing its 200-day EMA (the blue wave) near $5, which would be a 17% decline in total.
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