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The daily market structure turned bearish after the drop below USD 5.6. The rapid losses created an imbalance that could be filled in the coming days.
The $6.43 rejection on April 15 was an alarming development for Filecoin. A recent report highlighted how the drop below $6 added bearish pressure. At the time of writing, an imbalance in the charts could give sellers the opportunity to short FIL on a bounce.
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The stats weren’t encouraging for Filecoin either. There were many issues facing the network, and the selling pressure across the market didn’t help the FIL bulls. The $5 support probably would not withstand a bearish attack.
The retest of a bullish order block pointed to disappointing buying pressure
A bullish order block on the daily time frame was highlighted in cyan. It saw a sharp break in the previous market structure and turned to bullish on March 13. The buyers could no longer sustain that pressure in the following weeks.
Instead, as the price ventured into the order block and as deep as the $5.2 support, the bulls could only come up with a meek response. They were unable to drive the rally past $6.4, and the market structure was once again bearish.
The RSI stood at 40 showing downward momentum, and the 21 and 55 period moving averages also showed bearishness. Surprisingly, the CMF revealed strong capital inflows into FIL markets over the past ten days. It remained uncertain whether this could fuel a rally.
Realistic or not, here is the market cap of FIL in BTC terms
A gap in fair value was noted in the area of $5.87. A retest of this region could continue the downtrend. Therefore, short sellers may try to re-enter after a bearish reaction from the $5.82-$6.02 area.
Liquidation data showed bulls badly hurt, short-term sentiment in a bearish favor
Long positions worth $3.85 million were liquidated within 4 hours on April 19, according to data from Coinglass. Since then, long positions have continued to suffer much more than sellers. Over the past 24 hours, the long/short ratio showed 51% of market participants shorted the asset.
The Open Interest data also showed discouraged bulls. The OI had fallen almost as fast as the price. FIL saw an increase from $5.1 to $5.35 over the past 36 hours.
The OI remained at the $120 million mark during this period, so we can conclude that bullish speculators remained sidelined.
This post Filecoin Bulls Show Signs Of Weakness And April May See FIL Drop Down…
was published first on https://ambcrypto.com/filecoin-bulls-show-signs-of-weakness-and-april-can-see-fil-drop-below/