Cosmos price could break out and start a short-term relief rally. Nevertheless, the long-term trend is still bearish and suggests that new yearly lows will eventually be reached.
ATOM price has been declining since reaching a high of $17.20 on September 9. It made a lower high (red circle) on 18 September and subsequently accelerated its rate of decrease.
On October 1, ATOM price broke an ascending support line that had been at an 18 low of $5.55 since June. This is a sign that the upward Cosmos price movement has ended.
The daily RSI supports the continuation of the downward movement. The indicator has broken below the 50 level and has twice been validated as resistance (red sign). This is a sign of a bearish trend.
If the decline continues, the nearest support area will lie at $10.05. This is a horizontal support area for ATOM price and the 0.618 Fibonacci retracement support level.
Cosmos Price Prediction: Short-Term Bounce and Breakout
The technical analysis on the six-hour time frame shows a relatively bullish outlook, despite being bearish on the daily time frame. ATOM price is declining inside a descending parallel channel since the above high of $17.20. Such channels usually have corrective movements, which means that an eventual breakout will likely occur.
Therefore, it is most likely that the ATOM price forecast suggests a decline towards the $10.05 support area mentioned earlier, which also validates the support line of the channel. Later, a short term breakout will take the price of Cosmos to $15.
A movement above the $17.20 high (red line) would indicate that the trend is bullish and new highs would follow.
Will ATOM price drop to new lows?
The weekly time frame is in alignment with the outlook daily. Since the 2022 high of $44.70, ATOM price has probably started a new five-wave downside movement (black). If so, it has just completed a fourth wave pullback, as evidenced by the rejection from the middle of the channel connecting the highs and lows of waves one and two, respectively.
If the count is correct, the price of Cosmos has now started the fifth and final wave of this decline. The most likely level for it to end would be near the $4.80 horizontal support area, which has not been reached since January 2021.
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