Disclaimer: The following analysis is the sole opinion of the writer and should not be considered investment advice
The crypto market is still plummeting and many market participants feel fear. It is unlikely that Bitcoin can fall further in the days and weeks ahead. However, in the short term, Bitcoin has found some demand in the $33.5k region.
Fantom dropped to as low as $1.70 from $3 as Bitcoin dropped from $43k to $34.5k. Despite this drop, Fantom still seems to have some buyers. Can this sentiment make Fantom rise higher in the near future?
Source: FTM/USDT on TradingView
Bitcoin dropped to $34.5k and rallied to $36k in the last few days and then dropped lower looking for buyers and found them in the $33.5k region. In the second, smaller drop, many altcoins make lower lows. However, Fantom actually made a higher low at $1.9.
Graphing the Fibonacci retracement lines for the FTM rally from $1.77 to $2.41, we can see that $1.90 is the 78.6% retracement for this move, and There is also a confluence with a long-term support level.
At the time of writing, the price has found support at $2.16 and is attempting to climb higher. In case BTC trades sideways for the next day or two, FTM could increase further and possibly climb as high as $2.59, as long as it breaks through $2.32 from resistance to support. .
Theoretical basis
Source: FTM/USDT on TradingView
The sharp drop from $3 to $1.77 saw the RSI plummet into the oversold zone. However, over the past 12 hours or so, the RSI has indeed attempted to break above the neutral 50 level once again. As it bounces off the 38.2% retracement at $2.16, the RSI is at 52.1.
It’s too early to tell but this shows that FTM could go higher. However, the $2.32 resistance is a strong supply zone.
OBV has been decreasing steadily over the past week, but in the past three days, OBV has actually increased significantly. This shows that strong demand is indeed present behind the slight rally in FTM.
The 27.2% extension could be a short-term upside target.
Inference
In the short term, the previous bearish market structure was broken as the FTM price surged past a lower high of $2.17. At the time of writing, this level has moved from resistance to support. However, the $2.32 resistance remains strong.
The indicators show quite good momentum along with strong buying force. Provided Bitcoin does not plummet once more, FTM could increase in value over the next few days and climb to as high as the $2.55-$2.59 region.