- ATOM price has rallied by 50% since the last week of December.
- Cosmos consolidation could lead to a 20% spike to the upside.
- Invalidation of the bullish thesis is a daily settle beneath $13.
Cosmos price (ATOM) hovers at the top of a newly established uptrend. The consolidation could justify a volatile event that traders should prepare for in the coming days.
ATOM price waits for a trigger
Cosmos price has been trading rangebound for six days near the $13 price level. On day seven, the range converged further as a less than 1% spread occurred between price fluctuations. As with all markets, the stalemate can never go on forever, and an explosive move is likely to resolve the congestive market behavior.
ATOM price currently auctions at $13.08. Since December 19, the Cosmos price has been in an uptrend, returning 51% of the lost market value to loyal investors. At the time of writing, ATOM hovers above both the 8-day exponential moving average (EMA) and the 21-day simple moving average (SMA), compounding the healthy trend narrative.
The Volume Indicator, used to assess the market participants' strength, shows a waning pattern during the current consolidation. The pattern could suggest that bulls in the market see no need to offload their positions as they confidently aim for higher targets.
If this is the case, the liquidity zones above will likely pose a challenge. Two key levels would be the $14 price zone, which acted briefly as support before November's 45% mudslide. The second target is the November high at $15.81. The bullish scenario creates the potential for a 20% increase from Cosmos' current market value.
ATOM/USDT 1-Day Chart
To play Devil's Advocate, there is always a potential that the uptrend could fail. A daily candlestick close below the 8-day exponential moving average at $13 would be the first signal of a market reversal underway, invalidating the bullish thesis. The bearish target would be the $11 liquidity zone, resulting in a 15% decline from the current ATOM price.
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