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In the ongoing market recovery, $TAO, the native token of Bittensor, appears bullish and is poised for a massive upside rally due to its strong price action. With two big green candles, $TAO has recently broken out of a strong descending trendline that it has been facing since the beginning of December 2024.
$TAO Price Action and Upcoming Level
Following the breakout, $TAO appears to be transitioning from its prolonged bearish trend into a bullish phase. However, before this shift fully occurs, the asset is facing mild resistance from the 200 Exponential Moving Average (EMA) and the horizontal level at the $475 mark.
Based on historical price momentum, if $TAO breaches this hurdle and closes a daily candle above the $490 level, it could soar by 46% to reach the $720 level in the future.
However, the asset’s Average Directional Index (ADX) currently stands at 21 and appears to be declining, suggesting that $TAO lacks strong momentum, making it difficult for the asset to sustain its rally.
$4.52 Million Worth $TAO Dumps onto Exchanges
Despite these bullish price movements, long-term holders have been offloading the asset, as revealed by the on-chain analytics firm Coinglass. Data from spot inflow/outflow shows that exchanges have witnessed an inflow of $4.52 million worth of $TAO tokens during the recent upside momentum, indicating a potential sell-off.
Such inflows into exchanges can create selling pressure and lead to a price drop. However, the sentiment and market structure are different in this case, which could pose a challenge for the asset to rally in the coming days.
Rising Open Interest
Whereas, $TAO’s Open Interest (OI) has soared by 27% in the past 24 hours, indicating traders’ strong interest and confidence in the asset.
At press time, the over-leveraged level is $435.9 on the lower side where bulls have held $7.71 million worth of long positions, while $473 on the upper side, where bears have held $5.05 million worth of short positions. This liquidation level clearly defines that the bull is the one who is currently dominating the asset.