Aptos – What exactly will the month of June bring?

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

Aptos is a Proof of Stake blockchain that runs on the Move language, which is based on Rust. The recent tweet highlighted the features of the latest Aptos release, Move 1.3. These features add value to the network. In addition, there have been other positive developments in recent weeks, such as an increase in network activity and a decrease in gas prices. Ergo, a look at Aptos Price Prediction makes a lot of sense.

Read Aptos’s [APT] Price Forecast 2023-24

But, as often happens, good news for users does not translate into price gains for the token itself. APT has been in a serious downtrend since February, although the past three weeks have seen some stability around the $8 level. Can long-term investors re-enter the project, or should they be wary of further losses?

Aptos was forced to take back most of the profits it made earlier this year

Source: APT/USDT on TradingView

Based on the early 2023 rally from $3.06 to $20.4, a series of Fibonacci retracement levels (yellow) was drawn. It showed that the 61.8% and 78.6% retracement levels were at $9.68 and $6.77 respectively. The area between these retracement levels is known as the gold pocket. This is because there is a good chance that the asset will continue its former trend after returning to one of these levels.

That may not happen right away and the price may consolidate within or just above the gold pocket for another rally. Therefore, the $6.8-$9.7 area is one that investors with longer investment horizons should keep an eye on.

From a price action perspective, the trend was southward. After the price fell below the $16.3 level on February 5, the market structure and trend reversed into a bearish trend. Since then, APT has formed a series of lower highs and lower lows on the charts.

Since May 9, this downward trend seemed to have been broken. No new lows have been reached yet. Moreover, the region where this happened was especially interesting. The $7.6-$8.3 zone represented a bullish order block on the daily timeframe from Jan. 17.

Breach of the $8.3 long-term support gives the reins to the bears

When Aptos prices skyrocketed in January, the bears forced a few days to a halt in the $8-$8.5 zone. Going further back in time, the late October price action sheds light on why the $8.3 zone was a key resistance. At the time, APT fell below the $8.3 mark and again tested twice as much resistance. The bulls were rejected in this zone and when intense selling pressure came in November, Aptos had to sink lower.

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Now APT is clinging to the same territory as support and so far the bulls have managed to hold on. The RSI was well below the neutral 50 indicating strong bearish momentum in the market. Finally, the lower time frame charts showed that levels within this order block also mattered.

Source: APT/USDT on TradingView

The 4-hour chart highlighted the bears’ inability to take prices below $7.72 to date. It must be said that further losses are likely for APT. The range formation (orange) stretched from $7.72 to $8.8, with the midpoint of the range at $8.26. This midpoint coincides with a horizontally significant level of $8.33, from October and January.

It is not a good sign for the bulls that prices have hovered around this crucial level for the past two weeks, as it indicated that the bears had the upper hand, even in lower time frames. A look at the OBV confirmed this idea. The OBV fell in May even though APT prices were relatively stable at around $8.

Like the daily time frame, the 4-hour RSI also showed strong bearish momentum. APT’s market structure appeared bearish, but it’s possible that the lows in the range could see a small increase in prices.

The range highs at $8.8 and the $8.3-$8.5 stretch are two places to look for traders looking to short APT. A retest of either and high volume rejection can be used to enter short positions.

Meanwhile, the 4-hour structure would turn bullish at a session close to USD 8.6. However, given the importance of the $8.8 zone, it is more likely that a move past $8.6 would only be a hunt for liquidity and not a trend reversal.

Rising CVD suggested bearish bias could be wrong

Source: Coin analysis

Aptos’ 4-hour chart on Coinalyze brought a surprising finding. It was highlighted in a previous report and has yet to trigger a bullish reaction. The discrepancy was with the spot CVD.

Open interest has risen only marginally over the past two weeks as APT traded within a range. This indicated that speculators did not believe that a clear trend was underway. Meanwhile, the funding rate started ticking higher in recent days. This suggested that sentiment favored buyers more, even though price action across time frames suggested otherwise.

The spot Cumulative Volume Delta has been in an upward trend since May 12. This indicated an increase in bids, although this was not reflected in the OBV due to the way the indicators are calculated. All in all, there is a chance that APT will see a reversal in the near term, but it is unlikely. The available evidence, aside from the CVD, pointed towards a sustained downtrend, with the $8 and $7.6 levels likely to be extremely important in the coming days.