Disclaimer: The information presented does not constitute financial, investment, trading or other advice and is solely the opinion of the author.
- Bears were on the verge of breaking below the key support level.
- In addition, long positions worth at least $1.27 million were liquidated.
Cosmos [ATOM] traded within a compact price range over a period of one month. The altcoin has fluctuated between the $10.56 support levels and $11.59 resistance levels. As a result, ATOM has lost 18.7% of its value within this period.
Read Cosmos’ [ATOM] Price Forecast 2023-24
From Bitcoin [BTC] correction accelerated ATOM’s losses as sellers dominated the market.
Bears appear to be moving below the $10.56 support level
Source: ATOM/USDT in trade view
ATOM’s structure has been bearish since mid-March, with bulls and bears vying for dominance over the price.
Between April 29 and 30, a brief bullish rally took the price above the USD 11.59 resistance. However, this rally was halted by bears to bring the price back into the range. Similarly, a bearish move below the $10.56 support on May 10 was quickly reversed by bulls.
The overall market correction along with ATOM’s structure has once again pushed the price towards the $10.56 support level. Indicators on the chart suggested that bears could be successful in their attempt to break below this support.
The Relative Strength Indicator (RSI) stood at 40.43, indicating moderate selling pressure. The Awesome Oscillator (AO) stayed below zero and flashed a mix of green and red bars.
In general, retests of a support level after the first are weaker, and bears will want to use this as an advantage. With ATOM posting two bearish candles in a row in the 12-hour time frame, another bearish candle closing below the $10.56 support level could signal a breakout for sellers.
The short-term target for bears is the January low at $9.66. Alternatively, bulls still have a chance to defend this support level and attempt another price rally.
How much are 1,10,100 Atoms worth today?
Long liquidations suppressed any potential advantage for ATOM
Source: Coinglass
Liquidation data of Mint glass revealed huge losses for a long time. $1.27 million in long positions were liquidated in the last seven days, compared to $445.76k in short positions. This represented 74.07% of total liquidations within the period.
A massively falling spot Cumulative Volume Delta (CVD) and fluctuating funding rates further confirmed bearish dominance. This was a signal that speculators were actively shorting ATOM, which could lead to more price declines.
Source: Coin analysis