- FET saw a retracement after a bearish divergence, but it may be prepared for its next rally
- A short-term consolidation around $0.8 seemed possible too
Artificial Superintelligence Alliance [FET], the $2 billion market capitalization token of the AI consortium, possessed a bullish tinge on the price charts at press time.
The altcoin market has been moving sideways for nearly two weeks now, but Bitcoin’s [BTC] breakout into ATH territory could catapult the market higher.
Source: FET/USDT on TradingView
FET’s 1-day chart showed a bearish divergence (white) on the MFI. This was followed by a price pullback from $0.9 on 10 May to $0.7 nine days later. This retracement was a retest of an important horizontal level.
The Fixed Range Volume Profile plotted from late January revealed that the Value Area High was at $0.75. This level coincided with the lower high set in early March. FET’s reclamation of the $0.75 zone as support over the past three weeks was a statement of intent on the higher timeframes.
The MFI had cooled down and was near neutral 50, at press time. This suggested that there may be plenty of space for the price to expand higher. In fact, a move higher appeared likelier than a deeper retracement.
The $0.75 level’s importance as support suggested that once reclaimed, it would not be yielded immediately to the sellers. Another big clue came from the OBV’s trend. The OBV has been climbing higher over the past two months.
Although this trend slowed down in May, the OBV has not made lower lows on the 1-day timeframe. Hence, sustained demand might be present, and the AI token could likely climb higher too.
A potential short-term range formation?
Source: Coinglass
The 1-week liquidation heatmap showed that the cluster of liquidity that had built up at $0.81 over the past five days had been swept. A move to $0.83 was followed by a drop to $0.77, indicative of a liquidity hunt.
Some overeager short sellers have been wiped out too. The next pocket of liquidity overhead lay at $0.835, reaching up to $0.855. To the south, another pocket of liquidity lay at $0.76, just below the local lows.
Hence, it seemed likely that FET would form a range around the $0.77-$0.81 zone to allow liquidation levels to be built up in both directions. Liquidity engineered like this can then be swept before FET embarks on its next impulse move.
Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion
