Filecoin Price Analysis: FIL Extremely Overbought As Rejection From $70 Gains Traction
- Filecoin corrects after hitting a key barrier at $70 amid intensifying overhead pressure.
- The ascending channel’s middle boundary gives way to developing losses as $60 beckons.
Filecoin is in the middle of a retreat from $70 after rising within an ascending parallel channel since July 21. The token had has its fair share of the ups and downs; however, bulls remained steadfast with the push for recovery.
At the time of writing, FIL is trading at $66 while dealing with heightened selling pressure. With the channel’s middle boundary broken, the least resistance path is bound to remain sough in the coming sessions.
Filecoin Trend Correction Aims For $60
The Relative Strength Index (RSI) was recently overbought at 86, a situation that quickly flipped the trend bearish. As the RSI retreated from the area above 70, the odds for a bearish technical outlook were amplified. Note that a continued movement beneath the midline toward the oversold keeps the sellers in the driver’s seat.
Subsequently, short-term support is anticipated at $64. Therefore, bulls must defend this anchor zone if this support is supposed to hold and resume the recovery above $70. Otherwise, if broken, losses will explore levels heading to $60. The 50 Simple Moving Average (SMA) is in line to prevent the price from plunging sharply and may as well prevent the bearish leg from stretching to $60.
FIL/USD Four-Hour Chart
The daily chart reveals that besides the seller congestion at $70, Filecoin is trading below two key moving averages; the 100 SMA and the 200 SMA. If bulls manage to renew the uptrend and flip $70 into support, breaking through the seller congestion at the 100 SMA will be a daunting task. On the other hand, the 200 SMA will challenge the bulls’ efforts at $80.
At the same time, the TD Sequential indicator recently presented a call to sell Filecoin. The sell signal manifested in a green nine candlestick in the exact timeframe. Its appearance implies that buying pressure is about to start fading while sellers gain traction.
FIL/USD Daily Chart
If the bearish signal is confirmed, FIL will be expected to make a one to four daily candlesticks correction, thus, validating the bearish narrative. Support at $64 remains crucial for the renewal of the uptrend, but if push comes to shove, losses will stretch to test $60.