In this new crypto nugget on Wednesday, let’s take a look at the ATOM cryptocurrency that has been declining for 10 weeks. The aim of the day is to give you a technical analysis of the original holdings of theCosmos ecosystem† Will this project, consisting of creating a network of blockchains, be strong enough in the coming months to bring ATOM to old price levels? The task is not easy, far from it. To see it a little more clearly, let’s move on to our charts.
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ATOM cryptocurrency at the ultimate level
Since his all time high on $44.7† ATOM continues to fall towards price levels it has not seen since last summer. The trendline that was reaching higher and higher lows was broken at the bottom, signaling the first sign of a strong seller grip. Fast enough, ATOM closed below the most important level of the year. This price action confirmed the establishment of a weekly downtrend, which is the trend the asset is currently in. However, ATOM is now in the 2021 summer support zone on $8.6/$9†
The current challenge is as follows: follow the reaction of the price at this level to identify whether or not a reaction from the buyers. It is clear that the difference from last summer is the weakness of buyers. Although we had witnessed good matches defending this area three times, interest seems almost non-existent at the moment. In weekly, we may consider a rebound to correct some of the bearish movement, but this will depend a lot on the macroeconomic context and interest in risky assets anyway.
Since the weekly trend is bearish, it seems better to opt for a bearish scenario for the coming months, although this is not absolute. Breaking the support zone where the price currently resides, previously a resistance, could lead to a reintegration of ATOM in the range zone from August 2020 to January 2021. In addition to a return to the USD 5.80 pivot zone, it is quite possible to bring the price down to the lower limit, which was $4.80 at the time. And again, the most pessimistic scenario would be a reintegration of the first series with a return to $3. Of course, rest assured. We’re not there yet, far from it.
An asset in a situation of daily lateralization, but for how long?
What we can see on ATOM, it is the relevance of the key levels that we identified on a weekly basis. Price movements are much easier to understand hence the need to look for patterns on shorter time frames. Since April 2022, we have seen the formation of lower lows (LL) and lower highs (LH). These are lower and lower highs and lows. All the more, I remind you, ATOM is at its greatest support. More than ever, buyers need to regain ground if we don’t want to see a bigger bearish scenario.
Currently, ATOM is trading between a recent high of $12.49 and a low of $8.55. As long as the price moves between these two levels, there is absolutely nothing significant to report. In fact, this corresponds to simple intra-day fluctuations. So if the price registers a candle above its recent high, we have the signal of a possible change in structure. This could lead to a larger increase in ATOM. In this context, we might consider an optimistic return to USD 17, without breaking the downtrend…
Conversely, if the sellers don’t tire and keep pushing the price lower, watch out for a close below $8.55. This signifies a continuation of the downtrend with a new low as it ushers in a downward breakout from the weekly support zone. So it will be necessary to monitor the reaction of the price on this time frame. This bearish scenario could take us to $6.95 initially. Then, in a second step, ATOM could contact the pivot zone for $5.40/5.80. And finally, as mentioned above, a return to the lower bound of $4.80 should not be ruled out.
Yes, the cryptonugget is already coming to an end. Don’t worry though! Every Wednesday you can contact us for a brand new analysis! While you wait for next week’s assets, you now have all the key levels in your hands to the future movements of ATOM . to understand† Since the downtrend currently has a lot of support, it could lead to a breakout of the latter. So far nothing has happened. Are buyers coming at the last minute? More than ever, it is necessary to be on your guard on a daily basis to determine the future direction of the asset as quickly as possible.
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