I would fade rallies, looking to collect profits after several days of the green candlesticks.

Neo has done nothing for the last several days, and it does not look as if it has any real hope of recovering for a longer-term move. After all, the $16.50 level had been supported previously, and now it should have quite a bit of resistance attached to it. The last couple of days have been a very quiet market, and it is likely that we will continue to see the downward pressure jump into this market. I think a lot of what we are looking at is simple consolidation ahead of a continuation move.

There is nothing fundamentally positive about crypto in general, and certainly not about Neo. Neo is a market that has been collapsing for a long time, and this is just the most recent iteration of the problem. Ultimately, I do believe that this is a market that will continue to attract a lot of attention, but at the end of the day, it has no real reason to take off on its own. We are in a similar situation to when the tech bubble busted, as only the most useful companies survive. The crypto markets are about to see mass destruction, which is exactly what the industry needs to get rid of a lot of the less useful ecosystems.

At the end of the day, Neo could very well go to zero, but that obviously would take quite a bit of time. Whether or not that happens is still open for debate, but there is nothing on the price chart that suggests people care. The volume is absolutely anemic, which is a very negative sign in and of itself. As long as that is going to be the case, there is no reason to think that people are suddenly going to jump into this market. The only real hope for this market is if we get a speculative bubble going again in the entire industry. More likely than not, we are going to see a continuation of destruction when it comes to pricing, and I think Neo will get smoked before it is all said and done. I would fade rallies, looking to collect profits after several days of the green candlesticks. As far as buying is concerned, we would have to take out $20 to be serious about doing so.

One thing that a lot of crypto traders tend to forget is that the other half of the equation is the US dollar. 

Neo fell again on Monday to pierce the $20 level. The market continues to go back and forth, and I think at this point we are trying to form a longer-term consolidation area. However, it is worth noting that the market is going to have to pay close attention to crypto markets in general, as we have seen quite a bit of noisy behavior in the bigger coins.

Remember, more than anything else, larger markets will have a major influence on what happens in this market. Neo continues to look at the $20 area as significant support, extending all the way down to the $17 level. In other words, it would not be surprising at all to see a little bit of a bounce, but at this point in time, it still will struggle to have a longer-term move to the upside. It appears that Neo is going to continue to pay close attention to Bitcoin and Ethereum, both of which will drive the overall markets in general.

The 50-day EMA currently sits at the $23 level and is drifting a bit lower. Beyond that, we also have a lot of resistance at the $26 level, so I do think that there are a couple of barriers that you need to pay close attention to. If we get a bit of a bounce from here, a short-term trader may be able to take advantage of these levels, but I would not look for too much beyond that, at least not until we get more money flowing into riskier assets such as Neo.

One thing that a lot of crypto traders tend to forget is that the other half of the equation is the US dollar. The US dollar has been like a wrecking ball against most things, crypto included. I think at best you are looking at a back-and-forth type of market, with the potential of a major breakdown. If we were to break below the $17 level, it is likely that the market will continue to drop rather hard, perhaps showing a potential collapse. There are a lot of crypto markets out there right now that look threatened to say the least, so pay attention to the market on the whole to get an idea as to where Neo could go.

US dollar strength or weakness can also come into play, so pay attention to the US Dollar Index.

Neo did very little during the trading session, and you can even draw a nice comparison between Neo and Bitcoin because they have moved in the same type of momentum over the last week or two. Because of this, I think it is obvious that Neo would need to see Bitcoin take off to the upside, which could show money flowing back into the crypto market. Keep in mind that Neo is much smaller than Bitcoin, so if we get a sudden “risk-on move” in the crypto market, it should be somewhat outsized in this market.

The $20 level offers a significant amount of support that extends down to the $19 level, so if we were to break down below that level, is very likely that we could see this market reach the $15 level over the longer term, which would show even more weakness in the neo-market. At this point, Neo is starting to lose its influence, so you need to look at influence from other markets to determine where it will go. This is not Ethereum, this is not Solana. It does not have a “feel-good story” behind it, but it does make a nice trading instrument to take advantage of and leverage the overall attitude of crypto traders.

Looking at this market, the 50-day EMA sits at the $23.66 level and is dropping. I think that the 50-day EMA will cause a certain amount of technical reaction, but if we can break above there then it is likely that we go looking to reach the $25 level. The $25 level would be a large, round, psychologically significant figure that will also attract a lot of headlines. That is essentially 20% from here, but we need to see some reason for crypto to take off. On the other hand, if we were to take out the support level underneath and drop to the $15 level, then it is possible that we will lose 25%. Neo does tend to be very volatile, but if you line up at the chart on top of the Bitcoin chart, it does follow quite nicely so keep an eye on both charts in order to navigate what happens here. US dollar strength or weakness can also come into play, so pay attention to the US Dollar Index.