Cosmos Looks Primed for a Steep Correction
Cosmos has risen by more than 60% over the last week.
The recent uptrend appears to be approaching exhaustion.
A spike in selling pressure could push ATOM to $28.
Share this article
Cosmos looks like it’s on the cusp of losing a crucial support level that could lead to significant losses. The pessimistic outlook for ATOM is further validated by a technical indicator and a bearish pattern developing on the token’s 12-hour chart.
Cosmos Faces Possible Retrace
Cosmos looks primed to incur losses over the weekend as multiple bearish signals have appeared.
The interoperability network’s ATOM token has enjoyed a significant rally over the last week. The 20th-largest cryptocurrency by market cap has surged by more than 60% since Feb. 24. Now, it looks like Cosmos is bound for a spike in profit-taking that could trigger a steep decline.
The recent upward price action appears to have led to the formation of a rising wedge on ATOM’s 12-hour chart. As Cosmos moves closer to the pattern’s apex, it could be preparing to break through support. A decisive close below the wedge’s lower trendline could result in a 14.4% correction toward $28.
The Tom DeMark (TD) Sequential indicator adds credence to the pessimistic outlook. It’s currently presenting a green nine candlestick on ATOM’s 12-hour chart, which is considered a sell signal. An increase in selling pressure could validate the bearish formation, resulting in a one to four 12-hour candlesticks retracement.
It is worth noting that while the odds appear to favor the bears, ATOM could have a chance to invalidate the optimistic thesis.
The Fibonacci retracement indicator, measured from ATOM’s low at $21.50 on Feb. 24 to its high at $34.70 on Mar. 4, suggests that a decisive 12-hour candlestick close above the recent high of $34.70 could give ATOM the strength to advance higher. In this eventuality, the asset could rise toward $38 or even $40.
Cosmos’ ATOM token is trading at $32.73 at press time, which puts its market cap at about $9.5 billion.
Disclosure: At the time of writing, the author of this piece owned BTC and ETH.
Share this article
The information on or accessed through this website is obtained from independent sources we believe to be accurate and reliable, but Decentral Media, Inc. makes no representation or warranty as to the timeliness, completeness, or accuracy of any information on or accessed through this website. Decentral Media, Inc. is not an investment advisor. We do not give personalized investment advice or other financial advice. The information on this website is subject to change without notice. Some or all of the information on this website may become outdated, or it may be or become incomplete or inaccurate. We may, but are not obligated to, update any outdated, incomplete, or inaccurate information.
You should never make an investment decision on an ICO, IEO, or other investment based on the information on this website, and you should never interpret or otherwise rely on any of the information on this website as investment advice. We strongly recommend that you consult a licensed investment advisor or other qualified financial professional if you are seeking investment advice on an ICO, IEO, or other investment. We do not accept compensation in any form for analyzing or reporting on any ICO, IEO, cryptocurrency, currency, tokenized sales, securities, or commodities.
See full terms and conditions.
NFT Express: Your on-ramp to the world of NFTs
At Tatum, we’ve already made it super easy to create your own NFTs on multiple blockchains without having to learn Solidity or create your own smart contracts. Anyone can deploy…
Cosmos Developer Tendermint Rebrands to Ignite
Tendermint, the company behind the blockchain interoperability protocol Cosmos, has rebranded to Ignite. Ignite to Continue Building Cosmos Tendermint, the core contributor to Cosmos, is now called Ignite. According to…
Cosmos, Harmony, DeFi 2.0 Tokens Defy Market Slump
Cosmos, Harmony, and several so-called DeFi 2.0 projects have put in double-digit gains over the past 24 hours despite a decline across the wider market. Cosmos and Harmony Rally Cosmos…
Cosmos and Osmosis Surge While Rest of Market Flounders
The tokens for both Cosmos and its most prominent decentralized exchange, Osmosis, are up today while much of the rest of the cryptocurrency market is either flat or down. Positive…