Key Support Levels in Focus

The next downside target is the 50-day moving average at $3.03, closely aligned with a falling upper-quarter channel line that previously capped swing highs in September. This convergence suggests a potential support zone, as the line may now flip from resistance to support. A daily close below $3.16 today would confirm the breakdown below the 20-day average, reinforcing bearish momentum. Traders should watch this $3.03 – $3.05 area closely for signs of buying interest or further capitulation.

Double Top and Channel Dynamics

Thursday’s bearish reversal confirmed a double top pattern, triggered by a close below the $3.30 neckline. This pattern formed against strong resistance at the 200-day moving average, the top of a falling channel, and an extended rising channel line. Such failed breakouts often lead to sharp reversals, and today’s plunge further supports that thesis. If selling persists, the lower boundary of the rising channel could come into play, potentially aligning with deeper support near $2.95, where multiple indicators converge.

Critical Convergence and Timing

A key price zone looms at $2.95, where the lower rising channel line intersects the falling upper-quarter channel line in roughly seven days. This area gains added significance with a gap fill at $2.97 and an anchored Volume Weighted Average Price (VWAP) nearby at the same level. This trifecta of technical markers makes $2.95 – $2.97 a higher-probability potential support zone, if it is approached.

The weekly chart, poised to close near its lows with a bearish pattern after falling below last week’s low, further tilts the odds toward sellers. A rally above $3.30 would challenge this outlook, but for now, bears hold the reins. Watch Friday’s close for confirmation.

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