Cosmos (ATOM) price bounced from long-term support. Accordingly, it broke above important resistance levels. It is expected that it will continue to rise in the near future. So which levels attract attention for the cryptocurrency? Let’s see.
Weekly outlook for Cosmos ATOM
Cosmos (ATOM) price reached a high of $15.5 in early February 2023. It has been falling along a descending resistance line ever since. This move brought the price back to a key support level of $6.5 during the week of September 11-17 (green arrow).
After the initial recovery, ATOM price was rejected by the resistance line (red arrow). Accordingly, this situation caused it to drop to 6.5 dollars once again in the week of October 16-22. At this point, the price formed a bullish bar candlestick formation. Accordingly, it broke above the descending resistance line the following week.
What does it mean?
For ATOM, this signals the end of the previous correction. It also appears as a positive signal indicating that a new uptrend may be coming. On the other hand, the break also confirms the formation of the double bottom formation. This indicates a bullish reversal formation that usually occurs at the end of a downtrend.
This pattern becomes more important when it occurs on a weekly time frame and is combined with a bullish divergence in the weekly RSI (Relative Strength Index). Therefore, ATOM price is likely to rise another 26% from the current price. In this case, the price will move towards the next important resistance level at $10. Breaking this level will confirm that the long-term trend has switched to an uptrend. Additionally, ATOM price will retest the yearly high at $15.5.
Horizontal resistance break
The daily chart supports the bullish view on the weekly time frame. It shows that ATOM price broke above the key horizontal resistance level at $0.75 yesterday with a major bullish candlestick. This shows that the bulls are taking control in the short term. The daily RSI also supports the uptrend as it rose to the overbought zone without creating any bearish divergence.
When we look at Kriptokoin.com, the most likely scenario shows that the ATOM price will continue to rise towards the next resistance level of $10. It is important to exceed this level. It will help the price retest the yearly high of $15.5.
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