Fantom (FTM) Jumps 16% as Price Nears Key Make-or-Break Level
Will Fantom Maintain its Momentum? | Credit: Hameem Sarwar
Key Takeaways
- Fantom (FTM) broke out from a long-term resistance trend line.
- It has created a short-term inverse head and shoulders pattern.
- Will FTM break out, and how much will it increase if so?
Fantom (FTM) was one of the biggest gainers in the first few months of 2024, increasing over 150% until March. However, it has fallen since and currently trades just above its yearly open at $0.47. On Sept. 9, FTM increased by 16%.
Despite the increase, FTM trades under a critical horizontal area at $0.55. Can FTM maintain its momentum and break out, or will it be rejected again?
Fantom Price Under Resistance
The weekly FTM chart shows a price decline under a descending resistance trend line since the yearly high of $1.23 in March. The decline led to a low of $0.26 in August. FTM bounced afterward and broke out from the resistance trend line before the end of the month.
However, FTM still trades under the $0.55 horizontal resistance area despite the breakout. This critical area has existed since the start of 2023.
The position of technical indicators reinforces the importance of the horizontal resistance area. The Relative Strength Index (RSI) is approaching 50 from below, while the MACD is doing the same with the 0 level and a bullish cross. These are all considered bullish thresholds; a breakout above would confirm the reversal.
If the FTM price were to close above $0.55, it would likely push the indicators above these levels, confirming the upward trend.
So, whether FTM breaks out or is rejected can determine the direction of the long-term future trend. Looking at a shorter time frame can help establish what will happen.
Reversal or Relief Rally?
Looking closer at the daily time frame gives mixed signs. Firstly, the wave count is bearish, showing a five-wave downward movement. This means the long-term trend is bearish, and any upward movement is corrective.
However, the price action and indicators are bullish. As for the price action, FTM reclaimed the $0.40 horizontal area after falling below it, creating a higher low while doing so.
Also, unlike the weekly time frame, the daily RSI and MACD are bullish, increasing above 50 and 0, respectively.
The closest resistance area is between $0.75 – $0.86. The 0.5-0.618 Fibonacci retracement resistance level creates this resistance.
Finally, the six-hour time frame gives a bullish outlook. The FTM price has created an inverse head and shoulders, a bullish pattern. Its neckline sits at $0.52, and a movement that travels the entire pattern’s length would take the FTM price to the middle of the aforementioned resistance at $0.74-$0.85.
Even though the daily time frame gives mixed readings, the proposed move to $0.74-$0.85 would reclaim the long-term $0.60 area, pointing toward the long-term trend also being bullish.
Short-Term FTM Breakout Likely
While the price of FTM still trades under long-term resistance, it has created a short-term bullish pattern, likely to trigger an increase. A breakout from the short-term pattern could also lead to a reclaim of the long-term resistance, confirming the bullish trend.
Fantom Price Breaks 54-Day Resistance – Wave Count Hints at FTM Rise Above $1
