Cosmos [ATOM] recently rebounded from its long-term trendline support as the altcoin presents a symmetrical triangle structure on its daily chart. This price movement shows a strong rebound against the backdrop of Bitcoin rising above $75,000, its all-time high.
Can ATOM maintain its bullish momentum, or will it face a correction?
What happens next?
After a strong rebound in the past few days, ATOM has bounced from the key trendline support (white dashed line). As of the time of writing, the altcoin is trading at $4.50, slightly above the 20-day EMA ($4.35) and 50-day EMA ($4.47)—both of which are key resistance levels. If the closing price decisively exceeds these EMAs, it may lay the groundwork for further rises to the $5.66 resistance level.
However, if ATOM fails to hold these EMAs, it may drop again towards the trendline support at $3.65. This level has remained strong over the past few months.
As of the writing of this article, the RSI is approximately 53. This indicates a neutral market momentum, with buying pressure slightly higher. A continued rise above 60 may suggest a resurgence of bullish sentiment. On the other hand, a drop below 40 would indicate a weakening trend.
Key levels to watch
Support level: ATOM's direct support level is around $3.65, consistent with the long-term trendline. A drop below this level could lead to further declines to $3.11—another key support level.
Resistance level: On the upside, ATOM seems to face direct resistance at the 50-day EMA ($4.47) and $5.66. A successful breakout above these levels could push the altcoin to test higher levels, depending on broader market sentiment.
Derivatives data reveals this
ATOM's trading volume has sharply decreased by 27.67% in the past 24 hours, indicating that traders are being cautious amid recent market volatility.
Despite the decline in trading volume, open interest has increased by 1.39%, suggesting that market participants are holding onto their positions and may be anticipating a breakout or trend reversal.
ATOM's overall long-short ratio is 0.9736, indicating a balanced market sentiment; the long-short ratios for Binance and OKX are 2.864 and 2.68 respectively, showing a more optimistic market sentiment.
Additionally, Binance liquidation data shows that short liquidations outnumber long liquidations, indicating that recent price movements have caught shorts off guard. Traders should also consider Bitcoin's price movements, as it may influence the broader market direction and ATOM's trend.
