Cosmos (ATOM) – Struggling to extend the rally beyond the channel

Cosmos (ATOM) – Struggling to extend the rally beyond the channel

Posted on Thursday, February 10 2022 at 9:14 pm GMT+0000

Cosmos (ATOM) is struggling to extend last week’s rally beyond the mid-Bollinger band and the 38.2% Fibonacci retracement level of the last month’s downfall at 32.90.

The price deflected off the upper line of the regression channel, and the negative momentum revealed in the oscillators is promoting further potential negative price actions. The stochastics are sustaining a clear negative charge with the %K line pushing towards the oversold zone and the ROC is falling in the bearish territory after a failed attempt to overcome the previous resistance.

Should Cosmos strengthen its negative momentum, it would challenge a fortified support zone encompassing the middle line of the channel and the January 31st low at 25.50, near which the lower-Bollinger band also resides. If this critical boundary fails to deny additional price deteriorations, then the bears may eye the psychological number of 20.00 last seen on December 15.

If bulls retake the reins and manage to conquer the mid-Bollinger band and the upper line of the channel, the adjacent 38.2% Fibonacci level at 32.90 may try again to impede further advances from evolving. Triumphing over this barricade, the buyers would need to muster a more profound upside force to overstep the 50% Fibonacci level at 35.15, and the adjacent upper-Bollinger band then head towards the 61.8% Fibonacci level at 37.40.

To conclude, negative risks are still evident, and odds for a retest of the 25.50 low increased following the recent deflection of the 38.2% Fibonacci level. Only a sustainable move above the level could reduce bearish fears.