ATOM price has been showing bearish momentum since mid-June. Over the past three months, the price has corrected more than 50% and is hovering around the 52-week downtrend of $3.50.
The $5 mark is currently a level to watch out for, as it could signal the next trend reversal. Meanwhile, Bitcoin (BTC) and the general cryptocurrency market have experienced modest gains and remain positive.
However, ATOM price struggled to regain positive momentum and continued to give back gains. Trading below key EMAs, bears persisted in short, and the chart showed signs of distribution from the top.
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ATOM Price Prediction: Is a Recovery Imminent?
The daily chart shows that ATOM price could form a bullish reversal pattern that could trigger a trend reversal. A breakout and close above $5 will validate buying strength.
At press time, ATOM is trading at $4.41, up 5.76% in the past 24 hours. Its market cap has risen to $1.37 billion, ranking 47th among the top 100 Altcoin.
It is trading close to the resistance level of $5. There has been a steady selling pressure over the past few weeks. The ATOM cryptocurrency has faced rejections multiple times during the pullbacks.
Therefore, a downtrend is underway and the bears continue to assert their dominance.
Looking ahead, the trend is bearish as the bounce from higher highs has failed to sustain. This means that buyers appear to be losing momentum and the battle is in favor of the bears.
According to the Fibonacci levels, the $4 mark is the immediate 23.6% support area; a break below this level could lead ATOM price to the 52-week low area.
Technical indicators paint a positive picture
Despite the ongoing decline, few technical indicators suggest the possibility of a trend reversal. The Chaikin Money Flow (CMF) reading shows a positive outlook. Its reading of 0.11 indicates an increase in capital inflows into the market.
The increase in liquidity could push the ATOM price past the $5 mark. Moreover, this could trigger a massive up move in the coming trading sessions.
Moreover, the Awesome Oscillator (AO) value has also crossed above zero and reached around 0.027. This means that the bulls have gained control over the bears.
ATOM Futures Market Data Overview
Judging from the futures market data, the OI weighted financing rate remained positive at about 0.0087%, which suggests investors' bullish sentiment.
Additionally, open interest (OI) surged by more than 3.10% to $88.65 million at press time, representing a prolonged accumulation activity over the past 24 hours.
The immediate support areas of $4 and $3.80 can act as immediate support while the immediate resistance levels are around $4.70 and $5.
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