ATOM rallies 12% as whale activity grows: Can bulls push toward $2?

Cosmos [ATOM] rallied 12.81% as trading activity heightened across both Spot and derivatives markets, amid broader altcoin rotation.

The token pushed toward the $1.80 price level while Spot trading volume increased 110.48% to $74.46 million during the 24-hour period. 

The derivatives players also increased their activity, with Futures volume climbing 108.82% to $154.46 million.

The broader market conditions added another reason for the price expansion. Specifically, the Altcoin Season Index surged 53.12% over the past week, highlighting  a stronger capital rotation toward the altcoin sector.

Rising leverage adds conviction behind the rally 

Following the price rally, ATOM’s Open Interest increased 14.25% to $137.99 million. This implies that traders expanded the outstanding derivatives positions instead of reducing exposure during the rally.

The increase aligned with the 108.82% volume surge in derivatives, reinforcing the evidence of substantial speculative activity.

The alignment of these metrics supported the rally since renewed leveraged positions were entered as the market activity accelerated. 

However, the expanding leverage could accelerate price volatility in case ATOM encounters stronger selling pressure around the nearby resistance.

On the other hand, the Spot market activity provided a different signal, as exchange flows turned negative.

Big whale orders join the negative Spot flows

As of at the time of reporting, ATOM had recorded an approximate of -$98.66K Spot Netflow, implying outflows exceeded inflows during the latest reading. 

However, the recent broader exchange flows outlook remained mixed, rather than establishing sustained outflow dominance. Still, the most recent negative reading limited the immediate exchange-side supply pressure as ATOM attracted stronger trading activity.

More notably, the Spot Average Order Size indicator registered a “Big Whale Orders” signal, according to CryptoQuant. The indicator shows that larger executed orders accompanied ATOM’s sharp price recovery.

This whale participation added another signal of demand-related activity, although the indicator alone did not confirm accumulation. 

But combined with the negative netflows, larger orders strengthened the accumulation outlook around the Spot market. The token’s price action then placed the improving market conditions against a significant technical barrier.

Can ATOM extend its breakout toward $2? 

On the daily timeframe charts, ATOM cleared the $1.615 change-of-character level before extending sharply toward the $1.869 resistance zone. However, buyers were unable to secure this resistance zone during the recent price advance.

Therefore, the rejection left ATOM around $1.848, keeping the price above the newly reclaimed structural support level at $1.615. 

At the time of analysis, the RSI stood at 75.15, exposing the token to overbought conditions after its sharp price expansion. This suggests a possible short-term overheating could support a consolidation phase before another breakout attempt. 

However, holding above the $1.615 support level would preserve the improved structure despite any cooling from the current price levels. A successful break above the $1.869 resistance could likely expose the psychological $2 price level next. 

Final Summary

• ATOM’s rising volume and Open Interest showed stronger participation behind its 12% price rally.
• Whale-sized orders support the demand narrative, but $1.869 remains crucial before a $2 move.