The price of Fantom (FTM) has experienced notable fluctuations over the past 11 days, managing to avoid a drop to a new yearly low. While technical indicators present a mixed picture, the completion of a corrective structure offers hope for bullish momentum. This article examines the recent price action of FTM and delves into the potential future trajectory of the cryptocurrency.
Fantom Bounces Back After a Sharp Decline:
Following the formation of a lower high on April 18, the price of FTM entered a swift descent, characterized by a lack of significant bounces. This decline was seen as a sign of weakness in the market. Furthermore, FTM breached the $0.34 horizontal area, which is now expected to act as a resistance level.
On June 10, FTM reached a low of $0.21 before initiating a bounce, as indicated by the green icon. Since then, the price has steadily risen, exhibiting an upward trajectory.
RSI Signals Potential Reversal, Yet Confirmation Remains Elusive:
The weekly Relative Strength Index (RSI) supports the recent bounce but has not yet confirmed a bullish trend reversal. Traders often employ the RSI as a momentum indicator to determine whether an asset is overbought or oversold, aiding in the decision-making process for buying or selling.
When the RSI reading surpasses 50 and exhibits an upward trend, it signals an advantage for the bulls. Conversely, a reading below 50 indicates a disadvantage for the bulls.
While the RSI has been increasing and moved out of the oversold territory (as denoted by the green circle), it remains below 50. A decisive move above this threshold is necessary to confirm the trend as bullish, providing more confidence in a sustained upward movement.
FTM Price Prediction – Correction Possibly Complete:
Zooming in on the daily time frame, technical analysis suggests that the FTM price may have completed an A-B-C corrective structure (depicted in black). This corrective structure aligns with the Elliot Wave theory pattern, a tool used by technical analysts to identify recurring long-term price patterns and investor psychology for trend determination.
If this count is accurate, FTM has finished its correction and embarked on a new upward movement. Confirmation of this pattern would occur if FTM surpasses the wave A low (indicated by the red line) at $0.31, implying that the previous drop was corrective in nature.
Furthermore, the nearly 1:1 ratio between waves A and C adds credibility to the validity of this pattern. Should the count prove correct, the Fantom price is expected to rise to a minimum of $0.54, with the potential for a new yearly high.
Caution Remains Amidst Bearish Outlook:
Despite the optimistic FTM price prediction, a decline below last week’s low of $0.31 would signify a continuation of the bearish trend. In such a scenario, FTM’s price could potentially target a new yearly low in the region of $0.10.
Conclusion:
The recent price action of Fantom (FTM) has witnessed a rebound following a significant decline, offering hope for a bullish resurgence. However, technical indicators present a mixed outlook, with the RSI yet to confirm a reversal. The completion of a corrective structure suggests the potential for an upward trajectory, but caution should be exercised as a breach of key support levels could lead to further bearish pressure. Traders and investors will closely monitor FTM’s price movements to gain further insight into its future direction.
