After the correction phase of more than 35%, the ATOM price finds demand near the $25 mark and jumps more than 7% in the past day. The price action forms a short falling channel, the breakout of which will result in a significant bullish jump.
Key technical points:
- The ATOM price struggles to rise above the 20-period EMA in the 4-hour chart.
- The intraday trading volume in the Cosmos coin is $837.4 Million, indicating a 10% gain.
Source- Tradingview
The ATOM price shows a downfall of more than 35% in the past two weeks, resulting in the formation of a resistance trendline. Furthermore, the price action creates a short-term falling channel with a recent bullish jump within the pattern.
- The recent jump of more than 7% in the coin price drives it higher to the short-term resistance trendline. The trendline tracks a similar path as the 20-period EMA in the 4-hour chart. Therefore, the breakout of the 20-period EMA will result in a price jump to the long-coming resistance trendline.
- The crucial EMAs(20, 50, 100, and 200) showcase a bearish alignment as the 100-period average falls below the 200-period average. Therefore, the breakout of these EMAs can provide buying opportunities.
- The RSI indicator shows a sharp increase in the slope as it breaks above the 14-day average and continues to approach the 50% line in the 4-hour chart.
The ATOM Price Gains Momentum Near $25
Source- Tradingview
The ATOM price finally forms a bullish candle in the daily chart with a significant lower price rejection near the $25 mark. However, the price is yet to break above the 200-day EMA until then the jump remains a retest of the fallout.
The important resistance levels for the ATOM are $31.5 and $37. As for the opposite side, the support levels are $25.5 and $22.
The Moving Average Convergence Divergence indicator reflects a solid underlying bearish trend in action. The MACD and signal lines maintain a downtrend as they break below the zero line.
Disclaimer
The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.
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Source: https://coingape.com/markets/cosmos-price-analysis-this-descending-trendline-breakout-is-essential-to-initiate-recovery-rally-in-atom/