Cosmos price nears buy signal, potentially triggering 30% rally
|- Cosmos price has set up a falling wedge pattern that forecasts a 30% rally on a successful breakout.
- The upswing faces hurdles at $10.94, $12.50 and $12.87, so investors need to be cautious.
- A daily candlestick close below $10.20 will invalidate the bullish thesis for ATOM.
Cosmos (ATOM) price shows a lack of initiation from bulls, which has kept it subdued for quite some time despite the buy signal. It seems ATOM is on the cusp of ending its recent llull, increasing the chances of a breakout that could provide an opportunity for investors.
Also read: Cosmos price flashes buy signal, nearly 20% rally for ATOM holders likely
Cosmos price edges closer to a breakout
Cosmos price shows a clear falling wedge formation on the daily chart. This technical setup contains two lower highs and four lower lows. Connecting these swing points using trend lines reveals a falling wedge pattern.
The setup forecasts a 17% upswing to $13.86, which is obtained by adding the distance between the first swing high and swing low to the breakout point. Although Cosmos price has not breached the falling wedge setup, we can expect ATOM to breakout at roughly $11.83. ATOM trades at $10.46 at the time of writing.
However, for the breakout to occur, Cosmos price needs to overcome the $10.94 hurdle. Beyond the aforementioned blockade, ATOM will face two more resistance levels at $12.50 and $12.87. Only after clearing these levels can the altcoin hit its theoretical target at $13.84, which would represent a 32% increase from current price levels
ATOM/USDT 1-day chart
While the outlook for Cosmos price is optimistic, investors need to consider the delicate macroeconomic outlook and Bitcoin’s uncertainty. If things take a turn to the dark side, pushing ATOM to produce a daily candlestick close below $10.20, it will invalidate the bullish thesis.
This development could potentially knock Cosmos price down to retest the $9.37 support level.
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