The native token of Cosmos, ATOM, has shown the highest performance in the cryptocurrency market, rising nearly 10% in the last 24 hours.
The rise in ATOM's price was accompanied by a significant increase in open interest, reaching the highest level since June. However, it remains uncertain whether this upward trend is sustainable.
ATOM shows price rise with increased trading volume
ATOM is trading at $4.86, up 9% in the last 24 hours. During this period, trading volume also surged, reaching $228 million, the highest in 2 months.
When high trading volume accompanies an asset's price increase, it indicates strong buying interest from a wide range of participants. This suggests that the price movement is supported by broad market activity, making it more sustainable. It is not just a short-term fluctuation driven by a few traders.
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Additionally, ATOM's rising Relative Strength Index (RSI) confirms the high demand for this altcoin. It is currently at 62.47, indicating an upward trend.
This indicator tracks the overbought and oversold market conditions of an asset. When the RSI is between 50 and 70, it generally suggests that the asset is strengthening, and buying pressure is exceeding selling pressure. In this case, ATOM's RSI of 62.47 shows that it has bullish momentum, but has not reached an extreme level, leaving room for further price growth.
Moreover, ATOM's open interest has reached $75.44 million, the highest in 4 months, and increased by 10% in the last 24 hours.
The open interest of an asset measures the total volume of outstanding derivative contracts. An increase in open interest alongside a price rise confirms that the uptrend is strong and sustainable. Traders opening new positions add momentum to the price increase, driven by growing demand for the asset.
ATOM Price Prediction: Can it reach the March high of $14.58?
If ATOM's buying momentum persists, Fibonacci retracement analysis suggests $7.81 as a key price target, which is the 4-month high. Breaching this level could propel the token to $14.58, a level it has not reached since March.
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However, this bullish scenario could be disrupted by increased profit-taking, which could pull ATOM's price down to $3.63.
