FTX Token (FTT) is showing a bullish signal as the market recovers
The FTX Token (FTT) has been on the rise since Jan. 24 and is showing some bullish signs. However, there is a stark contrast between price action and technical indicators.
The FTT has been falling since hitting an all-time high of $87.3 on Sept. 7. However, the decline stopped when the FTT bounced off the $35 horizontal support area on Jan. 24.
Despite the recovery, technical indicators are showing mixed signs. On the upside, both the RSI and MACD have created a very significant hidden bullish divergence (green line). Such divergence is a strong sign of trend continuation. Since the underlying trend is up, the price is likely to continue this uptrend.
However, both indicators are still falling, which is a bearish sign.
Trader @CryptoPoseidonn tweeted a chart of the FTT and said that if the price breaks above $63, a new all-time high is expected.
Due to mixed signals from the weekly timeframe, it is necessary to look at the lower timeframes to determine if the FTT has indeed risen to a new all-time high.
FTT is booming
The daily chart shows that the FTT has broken a descending resistance line that has been forming since the all-time high mentioned above.
This line was then confirmed as support (green icon) on February 24th. Since then, prices have gone up.
However, the daily time frame also fails to confirm the direction of the trend as technical indicators and price action provide conflicting results.
While FTT price action is bullish, technical indicators are bearish. Both the RSI and MACD are falling, the former is below 50 while the latter is in the negative territory.
However, both indicators are very close to their respective bullish thresholds. Therefore, a slight increase in price will cause both to move into an uptrend.
If the uptrend continues, the key resistance area will be between $59.5 and $66.2 created by the Fib resistance levels of 0.5-0.618.
The 6-hour time frame shows that FTT is trading within a descending parallel channel. This is usually a corrective pattern, meaning a break above it would be the most likely scenario.
However, similar to the weekly and daily timeframes, the technical indicators are neutral/bearish, which offers some ambiguity as to the direction of the trend.
FTT/USDT 6 hour chart | Source: TradingView
Finally, the number of waves supports the possibility that the price will rise. The drop in FTT is like an ABC correction with wave A:C in a near 1:1 ratio.
Also, the overlap between the February 2022 high and the September 2021 low (red line) suggests the decline is a correction.
Daily FTT/USDT Chart | Source: TradingView
Disclaimer: This article is for informational purposes only, not investment advice. Investors should research carefully before making a decision. We are not responsible for your investment decisions
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