|

Cosmos investors save the day as markets navigate through a geopolitical minefield

  • Cosmos price action breaks below the important green ascending trend line that references the uptrend.
  • ATOM price has been paring losses at the time of writing and could see the scale tipping towards profits for today.
  • Expect squaring back more losses towards $27.63 and a break above the green  trend line if the current recovery continues.

Cosmos (ATOM) price action saw a sharp rejection at a short-term level marked up at $27.63. With that rejection, ATOM has lost 15% of its value but is already paring back losses as markets shift towards risk-on as investors analyse the situation in Ukraine's Donbass as not as precarious as previously thought. Expect to see pop back above the green ascending trend line, making this a false breakout, and then a return to or above $27.63, erasing the complete loss from Monday.

ATOM price shows resilience and could pair back the complete Monday loss

Cosmos price action lost around 15% of value in the market turmoil from Monday after Putin signed decrees to recognize two regions as independent and create an incentive to enter the region with military force under a humanitarian declaration. But for now, there has been no sharp increase in military movement or a significant escalation of violence in the region. That, together with Putin repeatedly saying he wants to keep talking, has led investors to look beyond the short-term impact and trust that this situation will be resolved relatively peacefully.

ATOM is thus a steal at current levels and should only see more investors jump on price action, creating a false breakout and seeing ATOM re-enter space above the green ascending trend line. That would be a perfect bear trap, and see the Relative Strength Index walk away from the oversold area towards more moderate levels around 50. There is plenty of room thus for bulls to navigate price action in ATOM back to $27.63, where the sell-off started on Monday.

ATOM/USD daily chart

ATOM/USD daily chart

Technically the green ascending trend line could create resistance with a firm rejection. Cosmos price action would then collapse as bears gain control of the price action and push price action towards the $22.00 intermediary before going for that final cut towards $20.07 – the low of December 2021 and the monthly S1 support level just above $20.50. This double barrier should catch any falling knives and refrain ATOM from dropping towards $16.42. 

Author

Filip Lagaart

Filip Lagaart is a former sales/trader with over 15 years of financial markets expertise under its belt.

More from Filip Lagaart
Share:

Markets move fast. We move first.

Orange Juice Newsletter brings you expert driven insights - not headlines. Every day on your inbox.

By subscribing you agree to our Terms and conditions.

Editor's Picks

Crypto market outlook for 2026

Year 2025 was volatile, as crypto often is.  Among positive catalysts were favourable regulatory changes in the U.S., rise of Digital Asset Treasuries (DAT), adoption of AI and tokenization of Real-World-Assets (RWA).

Sberbank issues Russia's first corporate loan backed by Bitcoin

Russia's largest bank Sberbank launched the country's first Bitcoin-backed corporate loan to miner Intelion Data. The pilot deal uses cryptocurrency as collateral through Sberbank's proprietary Rutoken custody solution.

Bitcoin recovers to $87,000 as retail optimism offsets steady ETF outflows

Bitcoin (BTC) trades above $88,000 at press time on Tuesday, following a rejection at $90,000 the previous day. Institutional support remains mixed amid steady outflow from US spot BTC Exchange Traded Funds (ETFs) and Strategy Inc.’s acquisition of 1,229 BTC last week.

Traders split over whether lighter’s LIT clears $3 billion FDV after launch

Lighter’s LIT token has not yet begun open trading, but the market has already drawn a sharp line around its valuation after Tuesday's airdrop.

Orange Juice Newsletter – Smart insights by real people. Every day.

A free newsletter highlighting key market trends to help traders stay a step ahead. Daily insights on the most relevant trading topics, compiled by our experts in an easy-to-read format so you never miss an important move.

Bitcoin: Fed delivers, yet fails to impress BTC traders

Bitcoin (BTC) continues de trade within the recent consolidation phase, hovering around $92,000 at the time of writing on Friday, as investors digest the Federal Reserve’s (Fed) cautious December rate cut and its implications for risk assets.