Analysis

Why a bullish reversal remains elusive for Filecoin

Filecoin hit key support level but was yet to show bullish reversal amidst bearish market sentiment.

Published

1 year ago

on

Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion.

  • Low and high timeframe market structures were bearish.
  • Demand stagnated in the Futures market amidst fluctuations in funding rates. 

Filecoin’s [FIL] sticky resistance near $3.4 allowed sellers to seek shorting gains in the past few days. After hitting the resistance on 8 October, players who shorted FIL enjoyed over 9% shorting gains at the press time value of $3.1. 

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In a previous technical analysis of FIL, AMBCrypto was bearish on the asset after hitting the sticky resistance. 

The validation of the projection after a price retracement to the bullish order block at $3.0 could offer buyers a reprieve. But a solid reversal wasn’t imminent at press time. 

Will sellers exit positions at this support?

Source: FIL/USDT on TradingView

The price reversal dropped to a high timeframe support and daily bullish order block (OB) of $2.950 – $3.127 (cyan) at press time. Although this could be hopeful to bulls, there were no signs of reversal at the time of writing. 

Key price charts were negative and leaned towards bearish sentiment in the near term. Selling pressure intensified, as indicated by RSI’s movement into the oversold zone. Besides, Spot market demand for FIL and capital inflows declined, as shown by negative readings on OBV and CMF, respectively.   

However, FIL could see a reversal towards the $3.2 and $3.4 hurdle if Bitcoin [BTC] recovered from recent losses. 

Demand for Filecoin stagnated in the Futures market

Source: Coinalyze

How much are 1,10,100 FILs worth today

? 

In the past few hours before press time, FIL’s demand in the derivative segment stagnated, as illustrated by the sideways movement of the Open Interest rates. In addition, the recent fluctuation of funding rates suggested a possible narrow-range consolidation before a spike. 

However, the declining CVD (Cumulative Volume Delta) showed sellers had a market edge at press time. 

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