Disclaimer: The information presented does not constitute financial, investment, trading or other advice and is solely the opinion of the author.
- ATOM’s bearish momentum had the upper hand on the bears at the time of writing
- However, ATOM could see a turnaround as more traders take longer positions
ATOM’s bearish momentum from mid-March has caused the price of the altcoin to drop more than 20%. Despite a bullish rally in mid-April, intense selling pressure has caused ATOM to crash to $10.51 at the time of writing.
Read Cosmos’ [ATOM] Price Forecast 2023-24
While bitcoin [BTC] and the general crypto market has made slight gains over the past few days, the price of ATOM has remained around this key support level. What can traders expect next?
The bearish momentum stalls at the key support level
Source: ATOM/USDT in trade view
Bears have had the upper hand in dictating ATOM’s price movements for the past three months. However, ATOM’s recent price action showed that bears found the $10.56 price zone very hard to crack. This price zone ushered in the ATOM price rally in January, reiterating the strength of buyers at this support level.
In general, retesting a support level after the first test is weaker, but bulls have refused to relinquish their hold on the $10.56 support level. The price has hovered above and below this support level for the past seven days, indicating diminishing selling pressure.
While bulls have been unable to trigger a sustained reversal from this level, indicators on the chart pointed to its potential. The On Balance Volume (OBV) indicator maintained a slight upward trend suggesting demand for ATOM. Although the Relative Strength Indicator (RSI) dipped below the neutral 50, it rose to 42 to also point to a possible reversal.
The 12-hour chart showed that a significant bullish candle closing above the USD 10.56 support level could push ATOM towards the main USD 11.59 resistance. If the bears successfully convert the $10.56 support level into resistance, the price of ATOM could reach its January low of $9.66.
How much are 1,10,100 Atoms worth today?
Market sentiment was slightly more favorable for bulls
Source: Coinglass
The long/short ratio on the 12-hour time frame revealed that market sentiment was slightly tilted in favor of a bullish recovery. Dates from Mint glass showed that longs had a 51.07% advantage, as of this writing.
However, the fluctuating funding rate showed that market speculators took a watchful stance towards ATOM. Traders should exercise caution and watch for possible price movements at the key support level before taking new positions.
Source: Coin analysis