This Bullish Formation Hints At More Gains; Time To Buy?

The Cosmos price analysis indicates consolidation with a positive bias. The price traded in a very range-bound manner with a mildly positive outlook. However, investors need additional confirmation to trade firmly in a particular direction.

Despite the challenges, Cosmos managed to grab the 23rd rank in terms of the market capitalization of $3,498,682,326. As of writing, ATOM/USD is exchanging hands at $12.22, up 0.87% for the day. The 24-hour trading volume rose 10% to $5.03billion.

• Cosmos price trade a bit higher with limited price action.
• A double-top structure indicates some challenges for the bulls.
• However, rising volume favors the upside in the coin.

Cosmos price stabilizes

 On the weekly chart, ATOM took reliable support good near $8.1, which was previously acted as resistance from March 11, 2019, to February 02, 2021.

However, On February  03, the price gave a breakout above $8.1, with an upside of more than 450% after the breakout. Recently, the price came for a retest at exactly $8.1 level, & started to move back up again, implying a possible reversal and “Buy on dips” strategy. 

Further, the price faces resistance at the 20-day exponential moving average ( $12.32). If the price is able to break above this given level on the weekly chart, then we can expect a good upside move of up to $14.50.

Remember, if the price couldn’t sustain close to current levels in the coming days, and started to fall, then it amplifies bearishness in the short time.

 On the daily time frame, the price formed a bullish “Head & Shoulder” pattern.  The asset is currently trading at the pattern neckline, facing the resistance of ($12.60).

According to this pattern, if the price breaks the above neckline on the higher side and gave closing above this line, then we can enter a buying trade, with an upside of up to ($15.55). The more time spent during the consolidation near resistance before the breakout, the price would move with higher force toward the higher level. 

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The nearest support is ($10.30) whereas the most immediate resistance is around ($13.00). There is a higher probability of the price breaking its resistance on higher levels.

In addition, if the price is corrected toward the support level then it would be a good “Buy on dips” Opportunity.

On the other hand, a break below the $10.30 level could invalidate the bullish outlook. And the price can move below $8.6.

ATOM is slightly bullish on all time frames. Above $12.60 closing on the hourly time frame, we can put a trade on the buy side.