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Filecoin ($FIL) has risen from $3 in the past three weeks and is currently trading at $3.3. It encountered selling pressure below the $3.5 resistance zone and volume indicators showed weakening bulls.
Filecoin Price Prediction
Previous higher time frame analysis of Filecoin highlighted the long-term downtrend and suggested a possible drop below $3. However, there was an upward movement in the cryptocurrency, retesting the $3.45 level just below another high timeframe resistance zone.
The market structure was in an upward trend last week, but the drop below $3.3 on October 3 shifted the structure towards a decline. Additionally, the relative strength index (RSI) fell below the neutral 50 level. Along with the metric, this could indicate a continuation of $FIL’s decline.
The mentioned situation is supported by on-balance volume (OBV), which has been in a steady downtrend since the end of August, according to experts. Even when Filecoin rose from $3 to $3.45, OBV did not show a significant increase that would reverse the previous trend.
What are the Expectations for $FIL?
At the time of writing, OBV continued to decline. Therefore, it is possible for $FIL to experience a further decline. It is noted that a short position is possible, and the probability of success may increase if $FIL prices retest the $3.5 drop order block on the 1-day chart. The open interest (OI) chart showed a rapid decline after the price dropped to $3.45 on October 2. The conclusion drawn was that market sentiment was bearish and long positions were discouraged.
However, the spot cumulative volume delta (CVD) chart, like OBV, also experienced a decline last week. Despite the recent surge in Bitcoin (BTC) prices, in which other altcoins performed well, CVD strengthened the idea that Filecoin is lacking significant demand. Therefore, buying $FIL in the coming days may be risky.