Filecoin [FIL] is down 8.95% in 24 hours, with a 27.3% plunge in daily trading volume and a 9.8% decline in Open Interest. Sometimes trading volume tends to fall during weekends.
The combination of a sizeable price and Open Interest decline showed pessimistic market expectations in the short term.
In other news, Filecoin’s Solstice upgrade (FIP118) is set to go live on the 19th of October. The upgrade will change how block rewards flow and direct a growing share to services that bring paying customers onto the network.
Solstice reduces the share that goes to consensus-only mining, and any unearned service share is burned.
Genesis vesting came to an end on the 15th of October. AMBCrypto reported that the termination will reduce the FIL emissions by 75%. Reduced supply is expected to increase scarcity and drive appreciation in the long term.
Filecoin price trends maintain bullish bias
Earlier this week, it was reported that rising whale demand could keep the bullish Filecoin momentum going. Bearish pressure on Bitcoin [BTC] spread across the crypto market, though there was still potential for recovery.
Since the local high of $1.276 made on the 11th of October, Filecoin prices have retreated by 17.18%. The price was still above the two key demand zones at $0.95 and $0.80.
The latter area was the one whose breach confirmed a bullish swing structure shift for FIL.
The technical indicators were fairly bullish but signaled a pullback in the short term. The RSI and the MACD were retreating toward neutral levels to show short-term bearishness, but the OBV was still in a firm uptrend that began in September.
Traders’ call to action – Round number support expected to hold
The swing structure on the 4-hour timeframe was bullish. A session close below $0.985 is needed to flip this in favor of the sellers. Even then, the daily swing structure would still be in favor of the bulls.
Given this context and Bitcoin’s resilience so far above the $80k level, it appeared likely that FIL would continue to defend the $1 psychological demand zone.
Final Summary
- The Filecoin Solstice upgrade is a boost for services that bring paying customers to the network.
- The short-term sentiment was bearish, but bulls have a good chance of keeping the uptrend going so long as the psychological $1 level is defended.