Decentraland MANA price action, before the flash-crash, showed signs that price was slowing down and momentum was waning. However, because the flash-crash was due to Non-Organic Selling, the outlook for Decentraland price has not changed.

Decentraland price to correct by 30%, flash-crash recovery not important

Decentraland coin price and the broader metaverse and gaming token sectors remain highly overbought. Parabolic is the name for it. A false sense of relief was probably felt by price bulls after a spectacular recovery and positive daily close chart on Saturday was accomplished. However, that feeling may not last.

Non-Organic Selling is a technical term to describe any price action that is done mainly due to resting buy and sell orders or, as is often the case in the crypto market, forced liquidations from leveraged positions in derivatives markets. The flash-crash on Saturday is a example of what NOS looks like and what the expected price recovery should look like.

There remains a massive discrepancy on the weekly Decentraland MANA price candlestick chart and its oscillators. The Composite Index and the candlestick pattern chart show no significant divergences over the long term. But between the Relative Strength Index and the Composite Index, a massive and drawn-out divergence does exist. That divergence is known as regular bearish divergence.

Regular bearish divergence occurs when price higher highs are made on the candlestick pattern chart, but lower highs are made in the RSI. Regular bearish divergence is a warning that the current trend may face an imminent price correction or broad trend change.

The likelihood of this occurring is strong because of the overbought conditions in the RSI. Additionally, the slope of the RSI, Composite Index, and %B have a slope that exceeds 45-degrees, generating a bearish price ‘hook’ pattern. The projected zone for major support level is near the $3.00 value area.

This near-term bearish price outlook is invalidated if Decentraland MANA price makes a new all-time high weekly close.

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