Mantra is approaching a key resistance level that has the potential to make or break OM in the coming weeks.
After weeks of consistent declines, Mantra (OM) is beginning to show signs of potential recovery. On Monday, May 12, OM was trading at $0.4384, up 0.48% in the last 24 hours. The token corrected after reaching a daily high of $0.467, above a crucial resistance level of $0.45.
The bounce came after an even stronger performance over the previous weekend. On Sunday, May 11, the token surged 40% from $0.37 to a weekly high of $0.52. The surge helped the price break above the 20-day simple moving average at around $0.45.
While the token did not hold above that resistance level, it is still trading above the $0.38 support. What is more, the relative strength index is at 23 points, suggesting slightly oversold levels.
Can Mantra recover?
Despite some positive momentum in the past few days, the big picture for Mantra is still bearish. The token is below both the 20-day EMA at $0.51 and the 50-day EMA at $0.74. These key indicators suggest significant bearish momentum, which is compounded by the recent events.
On April 13, Mantra took a nosedive, dropping 95% in just a few hours. While the CEO blamed exchange liquidations for the price fall, several investigators pointed to potential insider selling and market manipulation as the real cause.
The Mantra team made efforts to bring back the trust, with the CEO promising to burn his entire allocation of 150 million tokens, representing almost 10% of the total supply. However, the token burn, completed on April 29, did not have a major impact on the price. Since the token burn, OM dropped from $0.53 to a low of $0.4145.
