Disclaimer: The results of the following analysis are the author’s opinions alone and should not be considered investment advice.
- After the pattern collapsed, ATOM rushed towards the immediate support area.
- Binance fundraising has seen an increase as it turned positive over the past 24 hours.
- Open interest recorded an increase along with a decrease in the 24 hour rate.
After reaching its all-time high (ATH) in January 2022, Cosmos [ATOM] The price fell after falling prey to the bearish links. For example, April-June saw a strong downturn that pushed the altcoin towards multi-month lows on June 19.
Here AMBCryptos Predict Cosmos prices [ATOM] for the year 2023-24
While the recent price action has been growing gradually over the past four months, ATOM is still struggling to maintain its position above the 20/50/200 EMA.
A bounce from the immediate support area can help test the confluence of resistance in the four hour time frame. Bullish spreads may ease selling pressure.
At press time, the alt is trading at $12,143, down 2.19% in the past 24 hours.
ATOM has approached its support zone, can it find a reliable recovery?
The recovery from ATOM’s 20-month low in June paved the way for a steady recovery in the charts. These bullish efforts helped the coin find a place above the 200 EMA as they turned it into support. After testing this support several times, it failed to sustain the broader bullish edge.
The long term ascending channel has exacerbated the selling pressure to trigger the breakdown of the pattern. As a result, the price quickly fell below the exponential moving averages which indicates a downtrend.
With the price action approaching the immediate support range at the $11.9 region, it could see a strong reversal in the near term provided that the 20 EMA constraints are broken. A close above this level will open buying opportunities with a target in the $13.2 range.
However, the bearish crossover of the 20/50 EMA confirmed the selling strength. The inability of the price to break above the 20 EMA is likely to cause a slow compressing phase on the charts. A close below the ascending channel and the base line at $11.8 indicates a sell signal.
Moreover, Chaikin Money Flow (CMF) made higher lows as it diverged upwards with the price direction.
Funding rates on Binance turned positive
Interestingly, ATOM’s Binance funding rate has turned positive over the past day. This metric indicates that most traders have been somewhat on the upside in the futures market.
The price of ATOM has often been correlated with the highs and lows of these funding rates. However, the recent increase in financing rates could not induce a similar rate increase. If price action is followed, ATOM could see a rally in the short term.
An increase in open interest with a decrease in price
The open interest rate for ATOM futures has increased by about 4.95% in the last 24 hours. In contrast, price action is down about 2.1% during this time. In general, a decrease in the price and an increase in open interest indicates the opening of new short positions.
In general, Atom walked on eggshells. The motivators and objectives of the buy/sell will remain the same as discussed. Finally, buyers should consider the movement of Bitcoin and its effects on the broader market to make a profitable move.