Cosmos (ATOM) price broke out of its main hurdle and may continue to move towards its next nearest resistance.
ATOM, the native token of the Cosmos ecosystem, has been on the rise since December 17th. The upward move took the year’s high to $15.23 on February 2.
Moreover, on February 1, ATOM price broke a descending resistance line. The breakout was significant for two main reasons:
At first, the line was in place for 145 days. Breakouts from such long-term formations usually lead to significant upside moves.
Secondly, the line coincides with the 0.618 Fibonacci retracement resistance level at $13.87, adding to its importance. Now, if the pace of growth slows down then the sector is expected to take support.
The daily RSI readings are interesting. The indicator first generated a bearish divergence (green line), which caused a slight decline in the price. But, it has started rising again and may break above 70 soon.
As a result, the most likely Cosmos price forecast is a move towards the $16.65 resistance area.
Conversely, a daily close below the $13.87 support and the previous resistance line would invalidate this bullish analysis. In that case, the price of ATOM token may drop to $11.
Cosmos price continues to outperform bitcoin
Technical analysis for ATOM/BTC is decisively bullish. There are three reasons for this:
First, the price reclaimed the 55,000 satoshis support area after earlier deviating below it (red circle). This is a bullish signal that often precedes a bullish trend reversal.
Secondly, the price broke a descending resistance line and subsequently validated it as support (green icon).
Finally, the daily RSI moved above 50, and the price formed a bullish candlestick over the past 24 hours.
If the upward movement continues, the nearest resistance area will be at 72,000 satoshis. On the other hand, if the rally loses momentum, ATOM price could slide back towards the 55,000 satoshis support area.
To conclude, the price forecast is bullish for both ATOM/USDT and ATOM/BTC. A close below the horizontal support levels at $13.87 and 55,000 satoshis, respectively, will invalidate these bullish predictions. In that case, the price could drop to $11 and 40,000 satoshis, respectively.
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