Hacked Verge Token Takes Price Hit But Bull Outlook Remains
Privacy-focused cryptocurrency verge (XVG) has been in the news for all the wrong reasons in the last 24 hours, but the technical charts indicate better times may lie ahead.
Notably, the verge chain was attacked yesterday, with the hacker reportedly making off with $1 million-worth of tokens. The issue was first brought to notice by a user named "ocminer" on the Bitcoin Talk forum.
The verge team acknowledged the attack via Twitter in the afternoon Wednesday, while its primary developer, "DogeDarkDev," tried to calm market nerves by stating that the team has pushed out a "quick fix" and the team is working on "a whole new block verification process".
However, the quick fix turned out to be a hard fork, as pointed out by ocminer. That didn't go down well with the investor community, which called for a rollback to cancel the coins mined during the hack. The developers rejected that idea, however, and attempted to downplay the whole episode by calling it a "small attack." The team is scheduled to release the full fork update today.
Amid the melee, XVG witnessed solid two-way business.
According to Bittrex, the token fell from $0.0722 (05:00 UTC yesterday) to a low of $0.048 (07:00 UTC) today before regaining some poise. As of writing, the cryptocurrency is changing hands at $0.055 - down 13 percent on a 24-hour basis.
It is worth noting that prices had jumped to a six-week high of $0.078 on April 3, possibly due to successful crowdfunding campaign and speculation that verge is partnering with a major retailer.
Despite the pullback to $0.048, the short-term outlook remains bullish, as per the technical studies.
XVG cleared the descending trendline hurdle in a convincing manner on April 1 and closed well above $0.056 (March 27 high) on April 3, signaling a short-term bullish trend reversal.
The cryptocurrency has established higher lows, as represented by the ascending trendline and higher highs, as indicated by a move above $0.056 on Tuesday. So, XVG looks set to scale the 100-day moving average (MA) resistance lined up at $0.0789.
Additionally, the chart shows a "death cross" - a bearish crossover between the 50-day MA and the 200-day MA. However, the indicator tends to be a lagging indicator and shouldn't be a cause of concern as long as prices hold above the ascending trendline.
The short-term outlook is bullish and XVG will likely test $0.0789 (100-day MA) in the next couple of days. A break higher would expose $0.10 (psychological hurdle) and $0.135 (Jan. 21 high).
On the downside, a drop below the ascending trendline would abort the bullish view, while a break below $0.032 (March 30 low) would put the bears back in the driving seat.