NEO is starting to stage a much-needed technical correction after gaining over one-hundred in value since the start of the year.
NEO technical analysis shows that the cryptocurrency could correct back towards the $10.50 level before resuming its uptrend.
NEO medium-term price trend
NEO advanced to its highest level since mid-July 2019 earlier this month, as the increasingly popular cryptocurrency gained over one-hundred percent in value since the start of 2020.
NEO price analysis shows that the downside correction currently underway in the cryptocurrency could reach either the $11.60 or $10.50 levels before the uptrend resumes.
Drawing a Fibonacci retracement to the current yearly high to the October 2019 low, the 50 percent Fibonacci retracement level comes in at $11.60, while the 61.8 Fibonacci retracement is found at the $10.50 level.
Typically a technical correction begins after a large breakout move. With this in mind, price should test towards at least the 50 percent Fibonacci level.
It is also noteworthy that a large head and shoulders pattern is still present on the daily time frame. Bulls need to rally price towards the $24.00 level to invalidate the bearish pattern.
NEO short-term price trend
NEO technical analysis over the short term shows that the cryptocurrency is starting to make bearish lower highs and lower lows.
A head-and-shoulders pattern is currently visible across the lower time frame, with the neckline of the pattern located around the $13.40 level.
According to the size of the bearish pattern, the cryptocurrency could decline the $10.00 support level.
It is worth noting that a pullback towards the $10.00 level may be deemed as a necessary, and healthy technical correction.
It could also create a tremendous buying opportunity for both short- and medium-term NEO bulls.
NEO technical summary
NEO technical analysis suggests that a decline towards the $11.60 or $10.50 levels is likely to occur over the coming sessions. A correction towards the $10.00 support level would likely be seen as a great dip-buying opportunity for medium-term bulls.
