A descending resistance line rejected the price of Cosmos (ATOM) on Jan 16. It is likely to still be stuck in a corrective structure.
Prism v2 will be a sovereign blockchain built using the Cosmos SDK. It is a layer-1 blockchain that specializes in the trading, deployment and harvesting of produce. Prism v1 was launched on the Terra Classic network, but after the latter’s crash, it was decided not to run Prism v2, exposed to the limitations of creating smart contracts on foreign blockchains.
To allow ATOM holders to support the development of Prism, a weekly snapshot will be taken starting January 19th. Then, airdrops can be claimed once the mainnet is launched.
Presumably as a result of this development, the price of ATOM has increased by about 50% since the beginning of 2023.
Cosmos (ATOM) price moves into double digits
Since hitting a high of $17.20 on September 9, ATOM price has declined below a long-term declining resistance line. Most recently, on November 5 (red icon), the line resulted in a rejection, starting the current downtrend with a drop to $8.43 on December 16. Since then the price of the Cosmos has gone up.
On January 9, 2023, ATOM moved above the $10.50 resistance area and accelerated its rate of increase. This led to the highest price of the year on 14 January at $13.43. However, there was another rejection from the resistance line, which is still holding up.
A break above the resistance line is likely to propel it towards the $15.35, 0.786 Fibonacci retracement resistance level. On the other hand, a rejection could lead to a retest of the $10.55 support area.
Since the daily RSI is above 50 but declining, there is no conclusive indication which of these will happen.
Therefore, the direction of the future trend is undecided. To decide what will happen requires a closer look at the movement.
Cosmos Short-Term Price Prediction: Further Downside Before A Rally
Taking a closer look at the technical analysis from the shorter-term six-hour charts, it shows that Cosmos price has completed a five-wave downside movement, which led to a rejection from the resistance line.
If so, then ATOM Coin price is now stuck in an ABC corrective structure (white). Therefore, the most likely approach is a price move towards the resistance line once again, completing the B wave during the next 24 hours. Then a drop to the 0.5 Fibonacci retracement support level at $10.94 is expected to complete the correction. It will also give waveforms A:C close to 1:1 ratio.
On the other hand, a breakout from the descending resistance line would mean that new maximum prices are expected towards $15.35.
To conclude, the most likely Cosmos short-term price prediction is a rally towards the descending resistance line at $12.70 before the correction is completed by a decline to $10.94. A breakout from the resistance line would invalidate this ATOM price analysis and suggest that highs are expected near $15.35.
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