Fantom (FTM) price has cleared an important horizontal resistance area. The next important resistance is 110% away from the current price. So where’s next for the FTM?
FTM price is approaching its yearly highs and is showing bullish signs on multiple timeframes. Is it possible that the rate of increase will accelerate soon or the price will decrease?
Phantom price removes long term resistance
In January 2022, the FTM price reached an all-time high before falling below the descending resistance line. This caused a breakdown from the support level at $0.20 and led to a decline of $0.16 in November 2022. However, this decline was only a temporary aberration, as the price of Phantom has since increased.
Bullish movements are usually followed by breakdowns and divergences like these. This is because the sellers were unable to push the price down. Instead, the $0.20 support area was restored, and an upward move followed.
The Relative Strength Index (RSI) showed a bullish divergence (green line) before rising and is now above the 50 level, indicating an upward trend. The RSI is a momentum indicator used to identify overbought or oversold conditions. An upward trend and a reading above 50 indicate that the bulls still have momentum.
FTM price is currently trading above the $0.38 horizontal support area. The next critical resistance was found at the $1.15 average price, which is an increase of 112% from the current FTM token price.
Technical analysis for both daily timeframe indicates a bullish prediction for FTM price due to price action and Elliott wave theory wave count. Elliott Wave Theory is a tool used by technical analysts. It looks for recurring long-term price patterns and investor psychology in order to determine the direction of a trend.
The price appears to be in the fifth and final wave of the upward (black) movement. The number of short-term subwaves is given in white. If this is true, the price will be in the third sub-wave of the last wave. This is usually the part where the increase accelerates sharply.
The two most likely areas for a future price high are $0.80 and $1.10. The first is determined by projecting the length of the first and third waves onto the low of the fourth wave (green circle). The latter is found by doing the same thing with a Fibonacci length of 1.61 (black).
Fibonacci retracement levels work on the theory that after a significant price move in one direction, the price will correct or return part of the way to the previous price level, before resuming in the original direction. It can also be used to determine the top of future upward movements.
Given that the $1.10 target coincides with the long-term resistance area mentioned earlier and fits better with the number of sub-waves, it is likely to act as a top.
Despite this bullish outlook, if FTM price drops below the second sub-wave low at $0.39 (red line), this bullish prediction will be invalidated and it might decline towards $0.20.
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In line with Trust Project guidelines, this price analysis article is for informational purposes only and should not be considered financial or investment advice. BeInCrypto is committed to accurate and unbiased reporting, but market conditions are subject to change without notice. Always do your own research and consult with a professional before making any financial decisions.