Long

Looks Rare May be on Verge of Breakout

Updated

For new tokens like LOOKS, I tend to take a cautious approach when identifying a point of entry. Especially after the beating it has taken recently. As you can see from the chart, the price has moved above the descending channel on the 4 hour chart. To affirm my analysis I also noted the following:

I created a custom indicator that compares the current symbols RSI to the relative strength of the market (Bitcoin). As you can see from this plot, the RSI for LOOKS is coming back in line with that of Bitcoin. This indicates that the selling pressure has diminished. On the 1 hour and 2 hour charts, this indicator has exceeding Bitcoin which indicates that the increase in price, as a percentage, has exceeded Bitcoin.
The Looks Rare site recently cancelled it's liquidity program through Uniswap v2 distributing a massive amount of tokens to liquidity providers. In addition, they also implemented stage 2 of their staking program which cuts the staking rewards distributed by one-half. We should expect less pressure on the sales price due to these changes.

Overall, this presents us with a good entry point for LOOKS assuming it is a token you are interested in. I expect the price to reach levels in excess of $4.00 within the next month.

Note

UPDATE

I wanted to dive a little deeper to affirm my previous analysis since the breakout has stalled just a little bit. The RSI indexed against Bitcoin on the 4-hour chart is well into the green as expected. This is a great sign considering the change in price of Bitcoin over the last two days.

In addition, I have been keeping tabs on the daily sales of both Looks Rare and Opensea since the launch. Historically, daily sales of the top 5 collections at Opensea have been coming in between 10% to 30% of the top 5 collections at Looks Rare. The latest comparison has the daily sales of Opensea at 28% of that at Looks Rare. NFT sales for all marketplaces have been lagging significantly over the last month as the price for Bitcoin has declined. Since you can stake your LOOKS for a percentage of the 2% fee earned through NFT sales on their site, a recovery in the NFT marketplace should have a direct impact on the demand for and price of LOOKS even if Bitcoin fails to recover as expected.

I will revise my initial statement slightly by adding that this may be the last time you see the LOOKS token under $2.00. Please feel free to reply with any comments.

Hackfin

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