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While the Cosmos (ATOM) price has created a bullish pattern, it has not confirmed it with a decisive bounce.
ATOM is the native token of the Cosmos ecosystem, which aims to become an internet of blockchains. The Cosmos price has traded inside a symmetrical triangle since June 2022. The symmetrical triangle is considered a neutral pattern, meaning that a breakout and a breakdown are both possible.
More recently, the price was rejected by the triangle’s resistance line on Feb. 3 and 8 (red circle).
After the rejection, the ATOM price approached the triangle’s support line but did not reach it. Rather, it created a triple bottom pattern above the $10.50 horizontal support area. Besides being a bullish pattern, the triple bottom was combined with a bullish divergence in the RSI.
As a result, it is likely to initiate an upward movement. If so, the ATOM price can increase toward the triangle’s resistance line at $14.20.
On the other hand, if the ATOM token price closes below the $10.50 area, it could drop to $8.80.
The technical analysis from the short-term six-hour chart supports the bullish outlook from the daily one but does not decisively confirm it.
The most bullish symptom is the deviation below (red circle) and then the reclaim of the $11 minor support area. Decisive upward movements often follow such deviations.
While the ATOM price has retested the $11 area again and bounced over the past 24 hours, the RSI is not decisively bullish. Rather, the indicator is at 50, indicating a neutral trend.
Moreover, there is minor resistance in the form of a descending resistance line at $12.30. Therefore, even if ATOM confirms the triple bottom, it will face resistance at $12.30 before getting to the long-term resistance of $14.20.
To conclude, the most likely ATOM price forecast is an increase toward the short-term resistance at $12.30 and eventually the long-term one at $14.20. However, if the Cosmos price closes below $10, it would invalidate the bullish outlook and could catalyze a sharp fall to $7.70.
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