Can the Buying Sentiment Push VeChain (VET) Above 100 DMA?
VeChain native blockchain is called VeChain Thor, and it is a modified fork of Ethereum blockchain, optimized for supply chain solutions. VeChain relies on a consensus algorithm called ‘Proof of Authority,’ whose creation is credited to Ethereum co-founder and Polkadot founder Gavin Wood. Proof of Authority chooses a network participant based on reputation.
VeChain has 101 authority nodes, which process all transactions on its blockchain. Authority nodes are required to stake a minimum of 25 Million VET tokens, which are used for staking and governance.
VeChain has a total supply of 64.32B. In exchange for staking VET and processing transactions, authority nodes earn VTHO, which is used to pay for transaction fees on VeChain.
For starters, BTC is still recovering from its November crash, and like any other Altcoin, VET is highly correlated to BTC. While there are signs of a long-term uptrend, there have been lower highs since the crypto crash of May.
VeChain’s price trend shows initial signs of developing a buying zone near its new low level. The current price collapse can be seen emerging from April 2022, when RSI was at overbought levels.
The bad news is that the adoption doesn’t exactly translate to increased demand for VET because it’s only used for staking and governance. Staking is one of the most dominant factors behind the buying demand for VET tokens.
The minimum stake to become an economic node isn’t all that affordable for the average person. VET buyers should wait for RSI to enter at least a neural level of 40 before making fresh buying orders. Read more about VET predictions to make the right entry and exit-related investment decisions.
Speculation is the only other demand driver for VET, and most of this speculation comes from its low price tag and the belief that VET will reach a dollar. Since May 2021, VeChain has failed to hit a new all-time high, reducing with each fresher swing.
Currently, the prices fell again after facing profit booking from $0.09 levels. After the recent crash, VET would have to jump significantly just to reach its immediate resistance level. Once VET realizes the $0.10 level, we can expect it to continue moving upside down with some consolidation.
RSI shows some signs of recovery but still trades in the negative zones. Since the 100 DMA curve has started to decline, there will be some relief and positive sentiments.