Privacy-focused cryptocurrency Monero (XMR) rallied by nearly 9.5% in the past week compared with the crypto market’s decline of 8.5% in the same period. What’s more, the XMR/USD pair has broken above a strong, multi-month resistance trendline, hinting at more upside ahead.
XMR price action
XMR’s price was down by a modest 0.87% on April 10 from its two-month-high of $245 established a day before. However, the cryptocurrency still outperformed its top rivals, including Bitcoin (BTC) and Ether (ETH), on a weekly timeframe.
Speculations about entities using Monero to bypass sanctions could have boosted its appeal among investors. Meanwhile, The American research group Brookings warned last month that Monero, the first in the line of privacy coins, could be “used as part of a sanctions-evasion scheme.”
“As a result of the difficulties in tracking and tracing the individuals involved in privacy coin transactions,” Brookings explained.
“The IRS has offered payments of $625,000 to those that can crack the privacy protections of Monero, Zcash, and other such cryptocurrencies.”
Monero’s market capitalization has risen by almost 85% to $4.30 billion since February. While technical indicators suggest that it could grow further in the second quarter.
XMR market cap since February. Source: CoinMarketCap
Technical breakout in play
This week, XMR broke above a downward sloping trendline that had been capping its upside attempts since May 2021.
Interestingly, the trendline constitutes what appears to be a bull flag pattern, in combination with a parallel lower trendline acting as support. A basic tenet of bull flags is that they send the price in the direction of its previous uptrend (called “flagpole”) after it decisively breaks to the upside.
XMR/USD weekly price chart featuring ‘bull flag’ breakout. Source: TradingView
As a rule, bull flag’s upside target is typically the sum of the breakout point and the flagpole’s height. That puts XMR en route to almost $480, up almost 110% from today’s price near $235.
On longer timeframes, however, independent market analyst Don Yakka argues that XMR price could reach as high as…