Cosmos ATOM/USD extended its correction from the record highs above $32, registered on 07th May, and the price of this cryptocurrency can weaken even more in the upcoming days.Fundamental analysis: There is still a level of uncertainty surrounding this project
Cosmos is a decentralized network that enables blockchains to transfer value with each other while letting them retain their sovereignty. Before Cosmos, blockchains were unable to communicate with each other, while the technology of this network enables you to exchange assets and data across blockchains freely.
Each new independent blockchain created within Cosmos is tethered to the Cosmos Hub which is powered by ATOM cryptocurrency. The main goal of Cosmos is to tackle the lack of interoperability in the market, and according to the official website, ATOM will soon be securing many chains in exchange for additional staking rewards.
The popularity of this project is rising across the globe, while more and more exchanges are offering this cryptocurrency. Despite this, ATOM has collapsed from the record highs above $32 registered in the first week of May, and the risk of further declines is probably not over.
The cryptocurrency market remains under pressure, and the concerns among traders are that it may take a long time for prices to enter again in the bull zone. The price of ATOM is in correlation with the price of Bitcoin, and if the price of Bitcoin falls below the $30000 support, that will negatively influence ATOM.
“Bitcoin futures curve shows demand is weak, and the cryptocurrency bear market is just getting started. Bitcoin’s share of the crypto market’s total value needs to pass 50% to argue that the bear market is over,” an analyst from JPMorgan reported this week.
Fundamentally looking, there is still a level of uncertainty surrounding this project, and its success mainly depends on the flexibility of its strategy in response to the competitors’ moves. Cosmos is competing in the field with some heavy-weight players like Polkadot, and we can also not forget that regulations on the cryptocurrency market can be a threat to this cryptocurrency.
Investors should also have in mind that there is currently no limit on the supply of new ATOM, and if you decide to trade this cryptocurrency in June, you should always use a “stop-loss” order because the risk remains high.Technical analysis: $10 represents the critical support levelData source: tradingview.com
Cosmos (ATOM) could weaken even more in the upcoming days, and if the price falls once again below $10, the next price target could be around $8 or even below. On the other side, if the price jumps above $17.5, it would be a strong “buy” signal, and we have the open way to the $20 resistance level.Summary
Cosmos (ATOM) extended its correction from the record highs above $32, registered on 07th May, and the price of this cryptocurrency can weaken even more in the upcoming days. The daily trading volume has weakened, and if the price falls once again below $10, the next price target could be around $8 or even below.
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