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The Filecoin price has displayed a sharp rally over the past couple of days. In the past week alone, the altcoin surged more than 80% and broke past several levels of resistance. On the daily chart, FIL appreciated by 24%.
On the development front, Filecoin is targeting the launch of a Filecoin Virtual Machine (FVM) in the upcoming month. This development will offer smart contract capabilities. This upgrade will help to amplify and accelerate the token’s value over the coming days.
The technical outlook of Filecoin has remained extremely bullish, with a major surge in demand. Buyers were in excess in number as both demand and accumulation for the altcoin shot up substantially over the past two weeks.
It is, however, too early to predict whether Filecoin’s price will continue to rise, as a price correction cannot be ruled out. FIL has to remain above a few important price levels if the coin has to maintain a positive stance.
The market capitalization of Filecoin went up, which indicated that buyers were circulating in high numbers during press time.
Despite an 80% increase in price, Filecoin is still trading 96% below its all-time high, which it secured in 2021.
Filecoin Price Analysis: One-Day Chart
FIL was trading at $9.21 at the time of writing. The coin was stuck under a crucial price resistance mark of $6.36. Finally, with the double-digit gains, Filecoin managed to breach the aforementioned price level and flip it into support for the coin. Immediate resistance for the coin stood at $9.80.
A move above the $9.80 level will take the coin to $10.70. Both $9.30 and $9.80 are crucial resistance levels. On the flip side, rather than FIL being able to topple its next resistance mark, it should remain above two important support lines.
The area of vital support lay between $7.40 and $6.30. FIL can fall to $5.69 if the price falls below $6.30. The amount of FIL traded in the last session was green, indicating an increase in buying strength.
Technical Analysis
Ever since FIL crossed the $7 boundary, the coin has visited the overvalued zone three times. At the moment, Filecoin is overbought. The Relative Strength Index was at 80, indicating that buyers dominated the altcoin.
Usually, overbuying tendencies lead to some form of price retracement due to a price correction. In case of that, Filecoin has to remain above the $7.40 support line.
On that note, the altcoin was above the 20-Simple Moving Average line (SMA), which meant that buyers were dominating the price momentum in the market.
Other technical indicators have depicted that the bulls were present in full force at the time of writing. The Moving Average Convergence Divergence indicator indicates price momentum and change. The indicator formed green signal bars, which were related to buy signals.
Buy signals are often accompanied by a further increase in price. The Directional Movement Index (DMI) registers the price direction.
DMI was positive as the +DI (blue) line crossed above the -DI (orange) line. The Average Directional Index (red) was moving up near the 40-mark, indicating that the bullish trend was building on the chart.