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Filecoin (FIL) Consolidates Above Support, Rally Potential Ahead

Published
Nikola Lazic
Published
By Nikola Lazic
Edited by Ryan James

Key Takeaways

  • FIL is consolidating between $3 and $8.
  • A five-wave rally ended, followed by a corrective wave.
  • A sustained break above $4 could spark a new bull phase.

After reaching its yearly high of $12 in March and reverting to the horizontal support zone at $3, Filecoin (FIL) now sits in a consolidation phase.

If it can hold key levels, this could mark the end of a corrective wave, potentially setting the stage for another upward trend.

The price action in the coming days will be crucial in determining whether FIL embarks on a new bullish phase or continues its sideways movement.

FIL Price Analysis 

After reaching an all-time high of $230 in April 2021, FIL entered a prolonged bear market, bottoming at $3 on Dec. 18, 2022.

This low established a horizontal trading range, with resistance around $8, creating what appears to be a consolidation or accumulation zone.

On Oct. 19, 2023, FIL revisited its $3 support level and rebounded, again attempting to break past the $8 level. This effort was halted at $8, leading to a pullback to $5 by Jan. 23 this year. 

Following the formation of a higher low, FIL set a higher high near $12 on March 8, marking a 290% increase from its $3 low.

This rally represented the end of a five-wave advance, which led to a sharp correction afterward. Filecoin then dropped by 60%, reaching a low of $4.60 on April 13, where it entered a period of sideways trading.

FIL price analysis
FILUSD in consolidation | Credit: Nikola Lazic/Tradingview 

However, on Aug. 5, it moved lower and reverted to its $3 horizontal support. Since then, it has traded sideways again, around $3.60, which could be interpreted as another consolidation period before the next bullish phase

If FIL made a five-wave advancement until March, the downtrend until the present could be its corrective wave, leading to sustained upward advancement at its next move to $16. 

FIL Price Prediction

Zooming into the hourly chart, the consolidation made a five-wave pattern, forming a symmetrical triangle from Aug. 5.

This is not typical for a starting uptrend, as we should have seen an ascending one that would be a leading diagonal in this context. 

Although nothing implies bullishness, we are maintaining the bullish outlook as one of the likely scenarios.

Symmetrical triangles indicate equal pressure from each side until a decisive breakout is seen, and we don’t know whether buyers or sellers will win the struggle. 

FIL price prediction
FILUSD decisive move yet to come | Credit: Nikola Lazic/Tradingview 

From the Oct. 20 high of $4 – the ending point of the five-wave sequence, we saw a decrease to $3.20. This could be the breakout move, but the price quickly recovered to $3.78 on Oct. 30.

This is still a lower high than on Oct. 20, so should the price make a downturn, it could imply the breakout was bearish. But if the rise continues past $4, the likelihood of FIL entering a new bull phase would be high. 

Disclaimer: The information provided in this article is for informational purposes only. It is not intended to be, nor should it be construed as, financial advice. We do not make any warranties regarding the completeness, reliability, or accuracy of this information. All investments involve risk, and past performance does not guarantee future results. We recommend consulting a financial advisor before making any investment decisions.
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