Cosmos Dives Below $9.4, Can the Bulls Recover?

Disclaimer: The information presented does not constitute financial, investment, trading or other advice and is solely the opinion of the author.

• Despite a lower timeframe in favor of ATOM bulls, some factors showed that bears could reclaim the driver’s seat.
• The $10-$10.6 region was higher resistance in the time frame for swing traders to look out for.

Cosmos [ATOM] prices retested the $8.43 level as support on June 15. This was a higher timeframe support level that ATOM bulls had failed to defend in the June 10 selloff. This development sparked a rally that hasn’t stopped yet, with ATOM gaining 22% from $10 before the rejection.

Read Cosmos’ [ATOM] Price Forecast 2023-24

At the time of writing, Bitcoin [BTC] traded below the $30.8k mark, marking the threat of bears taking control of the market at any time. Yet the bulls were not out of the picture either.

ATOM saw a structural break, but a recovery was likely

Source: ATOM/USDT on TradingView

The recent higher low at $9.34 was broken on July 5, marked by the green line. While this represented a downward trend in the market structure, it was an aggressive reading of the Cosmos market. The $9.1-$9.4 has been a region of intense resistance since June 21 and only recently flipped to support. The trend on the 4-hour chart has also been bullish for the past two weeks.

The RSI dropped below the neutral 50, indicating a shift in momentum towards the ATOM sellers. The OBV also saw a pullback but maintained the June 12 uptrend. All things considered, it was uncertain whether the bears could take control. However, with BTC below $31k, a price move above $10 could prove difficult in the coming days.

While ATOM bulls can look to buy the asset, they should be aware that market sentiment could go either way. Neither bulls nor bears were dominant in the short term, but the bulls have the advantage. A drop below $9.1 would indicate that ATOM traders may want to look for short positions instead.

The $10.2-$10.6 represented a bearish order block on the 1 day time frame. Therefore, swing traders can profit here and buy on a move above $10.6.

How much are 1, 10 or 100 ATOM worth today?

The spot CVD saw a positive slope to indicate accumulation during the price drop

Source: Coin analysis

Over the past two days, the price of Cosmos and the Open Interest have fallen. This showed discouraged longs and highlighted bearish sentiment in the market. However, it was the 1 hour chart. Hence, near-term sentiment could turn bullish on a rebound from the support zone at $9.4.

In support of this idea, spot CVD saw a big spike in the last few hours. The positive slope during the price drop suggested that buyers were piling up during the pullback. So while conditions remain uncertain, the bulls have the upper hand in the near term.