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.

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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.

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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.

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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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Jack Williams
Jack Williams
As a Blockchain Analyst, I specialize in analyzing the performance of decentralized systems and optimizing their efficiency. Through data analysis, I provide insights on blockchain technology, smart contracts, and cryptocurrencies to help businesses make informed decisions and improve their operations.
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