Cosmos Is Stuck In A No-Trade Zone
Crypto Briefing | Mar 27, 2022 12:42AM ET
Cosmos' ATOM token has been underperforming as its price action remains subdued in a no-trade zone. Cosmos’ ATOM token continues to consolidate without providing any clear signals of where it will head next. Cosmos may have generated a significant amount of hype this year, but ATOM is still trading sideways.
The native token for the so-called "Internet of Blockchains" has seen its price endure a squeeze after a prolonged stagnation period, signaling that a spike in volatility is underway.
Cosmos has been touted as one of the most promising ecosystems across the crypto community in recent months, with growing interest in projects like JUNO and Osmosis. However, since the beginning of the year, ATOM has been stuck within a $5 price range.
From a technical perspective, it appears that the 100-day moving average at $26 on the three-day chart has been acting as support, while the 50-day moving average at $31 serves as resistance.
As long as the token continues trading in between both levels, ATOM looks stuck in a no-trade zone. However, a decisive three-day candlestick close outside the 100-day and 50-day moving average should determine where its price will head next.
Zooming out on the three-day chart reveals that ATOM’s governing pattern is a parallel channel that developed in early September 2021. This technical formation provides potential targets for where ATOM could trade after breaking out of the no-trade zone.
A bullish impulse that sends Cosmos above $31 could have the strength to see it rise towards the channel’s upper trendline at $44. But if sell orders increase and the $26 level is lost as support, it could dive to the channel’s lower boundary at $21.
Get The News You Want
Given the ambiguity that ATOM currently presents, it is likely that many traders will remain on the sidelines, waiting for confirmation before entering any long or short positions.
Original Post
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.