The amazing price rally came when the tokens and metaverse bull run was triggered.
Gala Games’ native token GALA rose nearly 350% in November, ignoring the wider market correction initiated by Bitcoin. In particular, GALA’s price rose from $ 0.088 to $ 0.42 between November 1st and 22nd.
GALA / USD price chart | Source: TradingView
GALA’s profits came mainly after the price increase of most gaming brands and Metaverse. For example, MANA, the native token of Decentraland – a blockchain-based virtual world that enables users to create, experience, and monetize content and apps, has grown by more than 30% from month to month.
Similarly, SAND, the native asset of Sandbox’s decentralized Metaverse project, more than doubled this month. Gaming projects, including the Network Division (DVI) and Ultra (UOS), also saw price growth of more than 100%.
Increase or correct further?
The uptrend in Metaverse and Game Token gained momentum after Facebook decided to rename itself Meta, with Mark Zuckerberg admitting that they would be “Metaverse” – not the social network – first.
GALA rose to a record high of $ 0.489 on Nov 22 amid the Metaverse madness. However, it also shows some weakness in the current upside momentum as the dreaded head and shoulders (H&S) pattern emerges.
One of the well known and trusted engineering patterns, the H&S, occurs when price hits three consecutive highs, with the middle high, called the top, being higher than the other two, called the top shoulder. Meanwhile, the three peaks share a common level of support known as a “cutout”.
On the short term chart, GALA’s left shoulder is currently near $ 0.39, corrected down towards bullish neckline support, then rebounding towards $ 0.48 for a top, bottom formation that eventually moves towards the neckline is retreating and is currently likely to rebound to form a right shoulder tip near $ 0.43.
GALA / USD price chart for setting up H&S | Source: TradingView
A breakout confirmation will be issued if GALA closes below the cutout in the event of a high volume. If that happens, its downside target, which is the maximum distance between the crown and the neckline, could bring GALA to $ 0.24 – about 34% below the possible breakout point.
Bearish divergence / bull flag
Aside from H&S, GALA shows a clear divergence between bullish and bearish momentum.
Notably, the GALA price made a series of higher highs. In contrast, the Relative Strength Index (RSI), which measures price change to gauge the overbought or oversold conditions of an asset, has made a lower high, as shown in the chart below.
GALA / USD price chart finds bearish divergence | Source: TradingView
GALA’s rally took place along with the falling volume, suggesting that the uptrend is unsustainable and lacks strong underlying momentum.
As a result, GALA confirmed a bearish divergence between soaring prices and declining volume, which reinforces the occupational health and safety setup discussed above. On the flip side, if price confirms a potential bull flag instead, as shown in the chart below, there is a risk that the entire bearish outlook will be invalidated.
GALA / USD price chart with bull flag setup | Source: TradingView
The bulls profit target is near $ 0.69 as GALA breaks out of the triangle range to move north as volume increases.
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According to Cointelegraph