Is ATOM Aiming For a $16 Price Mark?

Jay Crypto

Blogger

We will check whether the ATOM price is likely to reach the $16 level or not. We will also look into the recent developments in the Cosmos ecosystem. Let’s begin with the current market situation. 

What’s Going On?

The 19th-ranked crypto asset is trading above the $13 price level with a daily loss of 5%. ATOM has performed very well in the last 30 days with price gains exceeding 20%. According to CoinMarketCap, the asset has lost more than 5%  of its daily trading volume, reaching $623 million. The native asset of the Cosmos has also lost almost 70% from its all-time high of a year ago. The journey of ATOM in September has been remarkable, but the question remains whether it can maintain its bullish stance in the coming days or not. 

CoinMarketCap

Cosmos on AtomicDEX has been merged by Komodo to link the Cosmos ecosystem to other blockchain networks. Cross-chain protocol DEX and non-custodial wallet Komodo's AtomicDEX support UTXO and EVM-based networks. Hundreds of blockchains, including Bitcoin, Ethereum, Polygon, Avalanche, and Optimism, will be able to trade with the Cosmos ecosystem thanks to the integration, which will also make it permissionless and secure.

Cosmos owned 0.82% of the total value locked (TVL) in DeFi as of July 2022. The network currently supports over 200 native Cosmos dApps and is constantly expanding. While various bridging solutions have been constructed on Cosmos, they support only Cosmos and Ethereum-based blockchains.

Let’s see what else is happening in the Cosmos ecosystem to find the trajectory of the ATOM.

Where is ATOM’s Price Headed?

The price of Cosmos (ATOM), which had reached its all-time high (ATH) in January of this year, came under siege after caving under the pressure of market-wide selling. In particular, an unrestricted bear run from April to June dragged the coin to its 20-month low.

The 200 EMA (green) was initially resistance when the price moves most recently occurred, but ATOM changed it to instant support. The coin is at a crucial crossroads right now. A bounce back from the intersection of support levels could help the token signal a short-term rise. However, the divergences along the indicators may present difficulties. The alt traded above $13.3 at the time of publication, down  more than 5% from the previous day.

Let’s look at a technical analysis of ATOM:

Price Analysis: 4H Price Chart

The recovery from ATOM's 20-month low in June created the conditions for a steady rise in price. Through these bullish actions, the cryptocurrency was able to position itself above the 200 EMA. However, the price had not yet established a firm position above the red 20 EMA and 50 EMA.

ATOM received the much-needed boost to convert the $13.4 level from resistance to support following the most recent ascending triangle breakout. Additionally, throughout the previous two months, the price movement has formed an ascending channel.

TradingView

If the price action breaks through the $14.6 resistance level after rebounding from the up-lower channel's trendline and the 200 EMA support, a bull rally may develop. If this level were to close above it, buying opportunities with targets between $15.3 and $16 would become available.

Any bullish crossings on the 20/50 EMA would confirm a rise in purchasing power in the short future. But if the price is unable to surpass the $14.6 resistance level and the 50 EMA, the charts will likely enter a slow-moving compressed phase. A selling signal would be suggested if the price closed below the up-channel and the $13.4 baseline. 

The Relative Strength Index (RSI) gradually recovered as it moved from the oversold mark to the midline. However, the price action and its lower peaks have diverged negatively.

Conclusion

ATOM buyers will be looking for a believable rebound in light of the convergence of support levels (200 EMA, lower trendline of up-channel, $13.4 level). But to account for bullish invalidation, traders need to look for the entry triggers and targets mentioned above. In addition to these technical considerations, market sentiment analysis is essential for making a successful move.