Like all altcoins, ATOM’s price has fallen since liquidating $550 million worth of BTC, ETH, and altcoins last week, making its 35% recovery puzzling.
When a market crash occurs, assets become oversold and there is usually an “oversold bounce”, “mean reversion”, “mean reversion” or some kind of price jump to the lower end of the pre-crash range.
After that, the analyzed asset either consolidates and continues the downtrend or reverts to a bullish uptrend if the downside catalyst was not significant enough to break the market structure. That’s all basic Trading 101.
Cosmos (ATOM) price appears to be following that path this week, and the altcoin is showing some strength, gaining 35% since Aug. 22. But why?
Depending on how you look at it, and technical analysis is certainly a subjective process, ATOM’s price is either in an upward channel, or we can say that there is a rounding bottom pattern where the price is close to it stands to break above the neckline.
ATOM daily chart. Source: Trade View
The resistance above $13 (horizontal black line on the chart below) is about to be tested at the moment and with enough volume and “stability” in the broader cryptocurrency market, the price could be on track for the 200-day ma at $17.20 be.
Of course, if Bitcoin crashes at the end of the day or aggressive talk starts oozing out of Jackson Hole, the entire bullish ATOM structure is likely to come to an end. So when someone trades, get ready and choose the appropriate size.
If the price manages to reach the $17 zone without delay, your favorite technical analysts will say something along the lines of:
“If ATOM price manages to flip the 200-MA for support, a continuation from the $27 level might occur.”
You must have seen this on Crypto Twitter recently, but let me find an example.
So just up, sir?
What traders need to figure out is whether ATOM’s bullish momentum is simply the result of a “stable” market and bitcoin and ether trading within a relatively predictable range, or whether there is a set of Cosmos-related fundamentals driving the current move confirm and justify a rocker opening. For a long time.
Apparently, analysts at VanEck, a multi-billion dollar asset management fund, believe ATOM’s price will increase 160x by 2030.
It’s hard to believe, isn’t it? The prediction may be a little far-fetched, but see for yourself. Here’s what they said:
“Based on our discounted cash flow analysis of the potential value of the Cosmos ecosystem in 2030, we have come to a price target of $140 for the ATOM token with downside potential of $1. With ATOM priced at $10 as of 8/2/2022, we like the presented 14-1 odds and believe this is an opportunity to buy the token.”
Let’s take a quick look at their rationale for the $140 ATOM.
Product-to-market fit and a secure bridge between chains can thrive after the merger
VanEck analysts Patrick Bush and Matthew Siegel cite the Cosmos Inter-Blockchain Communication Protocol (IBC) as an optimistic catalyst, largely because “individual Cosmos SDK blockchains can open communication channels for the exchange of data, messages, tokens, and other digital assets.” .
According to the analysts, “the IBC architecture allows any blockchain to perform actions on another blockchain without relying on a trusted third party.” They continued:
“IBC’s permissionless, trusted communications technology solves many of the problems associated with trusted bridge solutions that have resulted in over $1 billion in funds being stolen through a bridge breach.”
Analysts also cite the Cosmos SDK, a strong product-to-market fit and token value accumulation, partially impacted by staking, and the soon-to-be-launched Cosmos Hub “cross-chain security” mechanism as reasons for their long term bullish outlook. .
What is happening on the development and roadmap side?
ATOM should be the main security in three new stablecoins to be launched in the Cosmos ecosystem.
Stablecoin mining requires ATOM tokens to be “locked” or escrowed, and according to the Cosmos Hub 2.0 roadmap, liquid staking is also expected to launch in the second half of 2022.
ATOM roadmap details. Source: CosmosHub
During the DeFi summer and after the summer resurgence was the issuance of stablecoins and liquid