Cosmos (ATOM) was launched in March 2019 through the fundraising Initial Coin Offering event in 2017 that raised over 11 million USD. Cosmos blockchain is becoming the backbone for interoperability between all cryptocurrencies. Even though some of the popular cryptocurrencies, such as were made using Cosmos. SDK, the valuation of ATOM has remained fairly generic without huge ups and downs.
The low amount of price action on this counter is a result of not being included among the popular coins by most investors. What potential lies ahead of ATOM can be derived from the price action.
ATOM Technical Analysis
After five straight days of making higher highs backed by strong volume growth, ATOM has bounced from the lows of $7.85 to the high of $12.80. This value is almost 80% bounce back from the lower levels. There is no fundamental support at this crypto counter other than the historical buying price range. Cosmos has already broken both the important moving averages and is facing either profit booking or facing resistance near the 200 DMA.
The resistances are coinciding with the moving average. Staying below $15 for long can bring the moving average lines to lower levels bringing an opportunity for better price action with attempts of reclaiming a new high. Current price action on daily charts has completely covered the value gained on June 30 with a red engulfing candle. This indicates a sign of a false breakout. Although there is a good chance that ATOM reached the current level just to trap new investors at higher valuations.
While the current swing has been positive so far, MACD indicates a direction change in the next part of the current swing. The trend reversal could retest up to the $10 level without any support. Hence making an entry at such levels could be a trap. As most of the cryptos are falling, one should wait for the beginning of a new swing before making a new position.
On hourly charts, predicting ATOM’s movement is far more accessible since the entire rush has been made in the short term. It is clear that buying action began around $9 levels which pushed it towards $12. The swing ended with an indecisive candle dropping down ten percent to $10. The current swing failed to reach a new high, and ATOM has been falling as a result of making a high of $12 back to the current day low of $11.20 at 9.00 hours on July 01, 2021.
Heikin Ashi charts making lower lows for the last couple of candles have been creating a fearful environment. If the price retracement from current swings, a lot of people can exit from their positions in fear.