beincrypto.com
Cosmos’s native token ATOM has emerged as the top performer in the cryptocurrency market, with its price surging by nearly 10% in the past 24 hours.
This uptick in ATOM’s price has been accompanied by a significant increase in open interest, which has reached its highest level since June. However, the question remains: how sustainable is this uptrend?
Cosmos Is the Talk Of the Town
ATOM trades at $4.86, noting a 9% rally over the past 24 hours. Its trading volume during that period has also skyrocketed, reaching a two-month high of $228 million.
When high volume accompanies an asset’s price rally, it indicates strong buying interest from many participants. This suggests that the price movement is supported by broad market activity, making it more sustainable. It’s not merely a short-term fluctuation driven by a small group of traders.
Read more: 11 Cryptos To Add To Your Portfolio Before Altcoin Season
Additionally, ATOM’s rising Relative Strength Index (RSI) confirms the high demand for the altcoin. As of this writing, it is at 62.47 and in an upward trend.
This indicator tracks an asset’s overbought and oversold market conditions. RSI readings between 50 and 70 generally suggest that the asset is gaining strength, with buying pressure outweighing selling pressure. In this case, the RSI of 62.47 shows that ATOM has bullish momentum but has not reached extreme levels; therefore, there is still room for its price to grow.
Furthermore, ATOM’s open interest has climbed to a four-month high of $75.44 million, having surged by 10% over the past 24 hours.
An asset’s open interest measures the amount of its outstanding derivatives contract that is yet to be closed. A rising price with increasing open interest confirms that the uptrend is strong and sustainable. Traders opening new positions add momentum to the price’s upward movement, indicating that it is driven by increased demand for the asset.
ATOM Price Prediction: A Rally Toward $14.58 Or a Decline to $14.58?
If ATOM’s buying momentum persists, Fibonacci Retracement analysis points to a key price target of $7.81, a four-month high. A breakout above this level could push the token toward $14.58, a price not reached since March.
Read more: 10 Best Altcoin Exchanges In 2024
However, this bullish scenario could be disrupted if profit-taking increases, potentially dragging ATOM’s price down to $3.63.