The bearish attack has affected the Filecoin price, which fell below the $6 mark, and the bears now have a solid foothold. On the one-day chart, Filecoin shows a consolidation with a loss of 1.1%. Over the past week, the currency has depreciated nearly 17%.
The technical outlook for Filecoin indicates bearish pressure, with a drop in demand and accumulation. If the sellers push further, it will add to the bearish pressure.
Bitcoin’s struggle to stay above $30,000 has weighed on other altcoins, keeping them below their immediate resistance levels.
Demand needs to pick up in the next few trading sessions for FIL to break above the $5.50 price. The decline in Filecoin’s market capitalization over the past day also indicates increasing selling pressure. The strength of the broader market remains crucial to the altcoin’s price movement in subsequent trading sessions.
Filecoin Price Analysis: One Day Chart
Filecoin was priced at $5.26 on the one-day chart | Source: FILUSD on TradingView
At the time of writing this report, FIL’s trading price was $5.26. Following its dip below the $6 mark, Filecoin has experienced a continuous freefall. The coin is facing resistance above $5.60; Breaking through this level will push the coin towards $6, with a potential attempt to trade at $6.30.
Conversely, if it does not trade at the current level, a local support for the coin will be established at $4.90. If the price breaks below this level, it will reach towards $3.80, strengthening the bears. In the last session, the amount of Filecoin traded was in the red, indicating a drop in demand.
Technical analysis
Filecoin noted a drop in demand on the one-day chart | Source: FILUSD on TradingView
In recent trading sessions, FIL’s buying force has decreased considerably due to a drop in demand. The Relative Strength Index showed that the buying force had depreciated and the selling force had taken over, as the index was below the 40 mark.
Furthermore, the FIL price fell below the 20 SMA line, indicating that the sellers had taken control and were driving price momentum in the market. However, if Filecoin breaks above the $5.60 mark, the coin can rally above the 20-SMA line, bringing the bulls back.
Filecoin showed sell signals on the one-day chart | Source: FILUSD on TradingView
At the time of writing, Filecoin gave sell signals in line with other technical indicators. The moving average convergence divergence showed red histograms, indicating sell signals for price momentum and trend reversals.
These signals suggested that FIL may experience further decline in the upcoming trading sessions. The Awesome Oscillator, which measures price momentum and movement on the chart, formed red bars below the midline, indicating that sellers took control of the market price and that FIL was experiencing bearish momentum. For the currency to start its recovery, the FIL must exceed the upper ceiling.
Featured Image from UnSplash, Charts from TradingView.com
This post Filecoin Experiences Strong Selloff, Potential For Price To Drop Below $5
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