The Alliance of Artificial Intelligence (FET) is on an upward trend, increasing by 31% over the past week. This recovery is driven by increased whale accumulation, indicating strong interest from large-scale investors.
The double-digit price increase of FET has brought it close to the upper boundary of the horizontal channel it has been trading in since June. The key question is whether this momentum will trigger a breakout above this important resistance level.
FET Whales Drive Rally
BeInCrypto's analysis of FET's on-chain performance has shown a significant increase in whale accumulation over the past week. Data from Santiment reveals that, over the past seven days, whale addresses holding between 10 million and 100 million FET tokens have collectively purchased 106 million tokens worth 174 million dollars at current market prices.
As whales accumulate more funds, it signals confidence in the future value of the asset. This high demand often affects retail interest, increasing buying pressure and pushing asset prices higher.
FET Supply Distribution. Source: Santiment
This increase in whale accumulation is largely due to FET's undervaluation, represented by the negative market value to realized value (MVRV) ratio. Santiment reports that FET's current MVRV ratio is at -86.25%.
The MVRV ratio compares the market capitalization of an asset with the total value of coins purchased at their realized prices, providing insights into whether the asset is overvalued or undervalued relative to its historical cost basis.
FET MVRV Ratio. Source: Santiment
Historically, investors have viewed negative MVRV ratios as a buying opportunity, realizing that the asset is trading below its historical purchase cost and may recover. Expectations of this recovery have led FET whales to increase their holdings in recent days.
FET Price Prediction: A rally above $2 is possible.
On the daily chart, FET has been trading in a horizontal channel since June. This channel is formed when the price of an asset oscillates between parallel support and resistance levels, indicating a period of accumulation or range-bound trading. Since June, FET has faced resistance at 1.72 dollars and found support at 1.09 dollars.
FET Price Analysis. Source: TradingView
At the time of writing, FET is trading at 1.63 dollars, trying to break above the upper line of this channel. If successful, it will push its trading price to 2.09 dollars. Conversely, a failed attempt to break the resistance threshold would bring FET's price towards the support at 1.35 dollars.