Fantom traders going short can have stop-loss above this level
Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the opinion of the writer.
Bitcoin fell beneath the $20k mark in recent hours. The failure of the bulls to defend both the $20.8k and the $20k levels indicated that sentiment was still strongly fearful in the crypto market.
Fantom showed hints of a bullish break on the move to $0.25 two days ago. This move was not sustained, and at press time the bias appeared to flip to bearish once more.
FTM- 4-Hour Chart
The H4 chart showed a bearish bias for FTM, however, this was flipped a couple of days ago. The downtrend formed a lower high at $0.26, but the price closed a session just above this mark.
At the same time, Fantom formed higher lows as well, evidenced by the rising trendline support.
Yet, this short-term uptrend broke down in recent hours of trading. The low at $0.22 was broken, and the trendline support as well.
FTM- 1 Hour Chart
On the hourly chart, the higher lows that the trendline touches are more clearly seen. In the past few hours of trading, this trendline support has been broken. At the same time, because the price dropped lower than a higher low of the uptrend, a market structure break was witnessed.
Hence, the structure now favored the bears, but because of the move to $0.255, the bias was more complicated than a straightforward bearish one.
The break of the trendline support suggested that a retest of the same could offer resistance, and a move toward the lows at $0.2 could materialize.
The hourly RSI slipped below neutral 50 to highlight bearish pressure. It has not been able to climb above the 60 mark over the past week. This meant the buyers lacked strength. The Stochastic RSI formed a bullish crossover in the oversold territory. This did not necessarily indicate a strong move higher for Fantom.
The OBV was unable to scale the highs from a couple of days ago and signaled the lack of buying pressure as well. The CMF was also beneath -0.05 to show significant capital flow out of the market.
The indicators on the lower timeframe showed bearish momentum and significant selling pressure. On the H4 chart as well, the bullish bias was not particularly strong. Rather, a bearish bias was favored.
A retest of the former trendline support, now resistance, can be used to enter a short position. A stop-loss above the $0.25 resistance can be considered, while the local lows at $0.2 can be used to take a profit.