Connect with us
Active Currencies 13961
Market Cap $2,386,161,378,422.69
Bitcoin Share 51.44%
24h Market Cap Change $0.99

Filecoin is back at near-term range lows but can traders look to buy FIL

2min Read
Filecoin trades within a short-term bullish order block, traders can anticipate a bounce in prices

Share this article

Disclaimer: The findings of the following analysis are the sole opinions of the writer and should not be considered investment advice

  • The one-hour timeframe order block has served well in the past
  • Indicators showed bearish momentum but this could shift soon

Filecoin has traded within a range over the past two weeks. A short-term bullish order block from 10 November has acted as a zone where buyers have been willing to bid FIL. It remained to be seen if this trend can continue.


Read Filecoin’s [FIL] Price Prediction for 2023-24


Bitcoin fell beneath the $16.2k support level and could face further losses in the coming days due to this bearish pattern. This could drag the prices of FIL down alongside the rest of the market.

The range low at $4.08 has been a rock so far

Filecoin trades within a short-term bullish order block, traders can anticipate a bounce in prices

Source: FIL/USDT on TradingView

Since 9 November, after Bitcoin crashed from$21.4k to $16.2k, Filecoin also found it had some support at $4.08. It formed a range between $4.08 to $4.81, with the mid-point of the range at $4.44. This mid-point served as a good resistance level in the past week, which made the range formation more credible.

On 10 November, a one-hour candle below $4.08 formed a bullish order block. The subsequent price action broke the lower timeframe bearish market structure to reach the range highs once again. Hence, a revisit to the range low was a good buying opportunity, in terms of risk-to-reward. Profit targets lie at $4.44 and $4.8.

However, repeated retests of a support level tend to weaken it. Moreover, the second retest of $4.08 on 14 November was unable to muster a rally past $4.44. This suggested that bulls were weak in the markets. The Relative Strength Index (RSI) stood beneath neutral 50 to show bearish momentum while the Accumulation/Distribution (A/D) indicator was flat in recent days to show a lack of buying pressure.

Hence, if the long trade failed, a trader can immediately flip bearish and use the bullish order block as a bearish breaker and short FIL. Support levels to the south can be estimated using the Fibonacci extension tool. Based on the drop from $4.88 to $4 on 9 and 10 November, the 23.6% and 50% extension levels were plotted to lie at $3.79 and $3.56.

Open Interest on the rise as the price dithers about support level

Filecoin trades within a short-term bullish order block, traders can anticipate a bounce in prices

Source: Coinglass

Since 10 November, the Open Interest behind Filecoin contracts against USD have been on a slow ascent. This showed that futures market participants were building up a position. But in what direction?

The Long/Short ratio of FIL in the past 24 hours was skewed in favor of the sellers. Therefore, the possibility of a drop beneath $4.08 over the course of the day can not be discounted.

Share

Akashnath Sumukar works as a Senior Journalist at AMBCrypto. Based in Chennai, India, he has been an avid follower of the cryptocurrency market since Bitcoin’s boom and bust cycle of 2017. A graduate in Chemical Engineering, he is an expert in technical analysis. In fact, Akashnath has a particular interest in reading price charts and predicting how an asset will move over the short and long term. A self-taught trader and as someone who holds cryptos himself, he is always on the lookout for the next opportunity he can possibly capitalize on, while also educating his audience.
Read the best crypto stories of the day in less than 5 minutes
Subscribe to get it daily in your inbox.
Please check the format of your first name and/or email address.

Thank you for subscribing to Unhashed.