HomeNewsCosmos: Can ATOM Bulls Sustain Momentum and Rally Above $8.53?

Cosmos: Can ATOM Bulls Sustain Momentum and Rally Above $8.53?

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  • Cosmos [ATOM] recovered a crucial support level with a 19.5% gain over the last week.
  • Despite these gains, the futures market still hints towards an impending bearish scenario.

In the past week, Cosmos [ATOM] managed to dispel some apprehensions spurred by its mention in the US SEC lawsuit against major cryptocurrencies. Surging by 19.5% within this period, ATOM reinstated its foothold at the $8.53 support level.

As Bitcoin [BTC] consolidates around the $26.5k mark, ATOM bulls may be laying the groundwork for further gains, strengthening their position at this key support level.

On June 10, ATOM’s bearish trend reached a new low when it plummeted to July 2022’s price of $7. This substantial dip resulted in the breaching of the $8.53 support level, which was last tested in December 2022.

However, bullish investors swiftly mobilized at the $7 price level, generating a moderate rally of 19.5% from June 10 to June 17. Consequently, ATOM climbed back over the $8.53 price level. The last time ATOM embarked on a rally from this critical support level, it reached its YTD-high of $15.45 in February 2023.

As the price consolidates just above this vital support, the prospect of another significant bullish rally seems increasingly plausible. Capital influx, as indicated by a positive reading of +0.15 on the Chaikin Money Flow (CMF) and a slight upward trend in the On-Balance Volume (OBV), supports this bullish speculation.

However, the Relative Strength Indicator (RSI) currently remaining under the neutral 50 mark, serves as a word of caution for bullish investors despite a strong rebound from the oversold zone.

Bulls now aim at the $10.56 mark. A bullish structure on lower timeframes could expedite this move, while a weakening buying pressure at the current support level of $8.53 may push ATOM back toward the $7 price zone.

Contrarily, the futures market provides no comfort to the bulls, as reflected by a negative funding rate on higher timeframes. This points to the market gearing up for further bearish activities.

The bearish sentiment is reinforced by the liquidation data, with $290.25k worth of long positions liquidated in the past 24 hours, accounting for 99.4% of total liquidations during this period.

A bullish rally for ATOM may hinge heavily on Bitcoin [BTC] gaining substantial bullish momentum in the forthcoming days.

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Godfrey Benjamin
Godfrey Benjamin
Godfrey Benjamin is an experienced crypto journalist whose primary goal is to educate everyone about the prospects of Web 3.0. His love for crypto was sparked during his time as a former banker when he recognized the clear advantages of decentralized money over traditional payments. Business Email: info@ethnews.com Phone: +49 160 92211628