With steady gain in the past two weeks, should you invest in Filecoin’s short-term bullishness
Decentralized storage platform Filecoin has not had a brilliant run on the charts in the past few months. Since October, it has shed nearly 72% in value, from $80 to $22.3 at press time. It had hinted at the beginning of a downtrend in late September and has slid steadily lower on the charts since October. At the time of writing, a trendline of some importance appeared to be broken. Short-term bullishness had been brewing in the past week. However, the most pertinent question is- Can Filecoin break the bearish market structure over the next few weeks?
Source: FIL/USDT on TradingView
The trendline (white) held some importance, primarily owing to how the price has respected it since November. However, it has to be remembered that the break of a descending trendline does not equate to establishing an uptrend. Rather, this break could signify a run upward, before the next leg lower for FIL.
Therefore, unless the market structure’s previous lower high at $31.53 is broken, FIL would continue to trade within a long-term bearish structure.
Moreover, this lower high had some confluence with the 23.6% Fibonacci retracement (yellow). This level was plotted based on FIL’s move from $81.22 to $16.82. Hence, the $31-$32 area can be expected to offer strong resistance, provided FIL can indeed climb that high.
Another place where FIL can run into sellers was at $27, the lower low preceding the lows at $16.82. A retest of the $27 mark could be viewed as a bearish retest of a support level that FIL had traded at last month.
Source: FIL/USDT on TradingView
The indicators did not yet show a longer-term trend change was established for FIL. The RSI on the 12-hour chart formed a bullish divergence last month, in the oversold region. Since then the
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