Cryptocurrency

Cosmos: ATOM likely to see a bounce, but how high can it reach

Disclaimer: The findings of the next evaluation are the only real opinions of the author and shouldn’t be thought of funding recommendation

The development throughout the altcoin market remained extraordinarily bearish on the decrease timeframes not too long ago. Cosmos was not an exception, as its market construction remained bearish as the value fashioned a sequence of decrease highs and decrease lows. Bitcoin hovered within the space between $30k and $32k but has not but capitulated regardless of the robust worry available in the market.

ATOM- 2 Hour Chart

Source: ATOM/USDT on TradingView

Is a capitulation occasion across the nook, or was Bitcoin’s transient foray beneath the $30k mark the day before today enough to kind a market backside? How will this have an effect on ATOM? For starters, ATOM has moved comparable to Bitcoin on the charts. This will not be a outstanding commentary, as the value motion of many altcoins is sort of intently correlated to Bitcoin’s.

At the time of writing, ATOM fashioned a bullish divergence with the momentum and OBV indicators. This recommended that ATOM may see a bounce in value within the hours to come.

The $12.5 is the primary goal of this contrarian transfer, as it marked the native backside a couple of days in the past. Slightly additional north is the $13-$13.3 space, which noticed some demand a few hours in the past earlier than ATOM got here crashing down.

Therefore, these are the 2 areas the place sellers are likely to be robust, and a quick place may very well be opened.

Rationale

Cosmos: ATOM likely to see a bounce, but how high can it reach?

Source: ATOM/USDT on TradingView

The RSI made a increased low (white) at the same time as the value made a decrease low, which is a robust bullish divergence. Even although the RSI has been beneath impartial 50 over the previous week, denoting a bearish development, this divergence hinted at a bounce. The similar story with the OBV- whereas it has been on a downtrend previously week, it additionally confirmed some real purchase quantity previously two days.

The Awesome Oscillator was additionally beneath the zero line, but the height it made beneath the zero line was decrease, which indicated a weaker bearish momentum and a potential bounce within the subsequent few hours.

Conclusion

A bounce to $12.5 or the $13-$13.2 space may very well be seen within the subsequent few hours. However, past that, Cosmos would possibly wrestle to make positive factors. Hence, somewhat than wanting to purchase the asset, ready for extra favorable situations and even shorting the asset across the $13 mark may very well be an choice.

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