Some traders have said that Filecoin (FIL) has lost its momentum because its current price of $ 64 is more than 70% below its all-time high of $ 238. However, this decentralized data-sharing platform shows signs of an adoption. rising and this could cause the price of the FIL token to accelerate its current uptrend.
The FIL token is used to buy storage space and retrieve data from the Filecoin network. At the same time, its users get rewarded for selling their excess storage using this open source platform. To compete with existing centralized cloud storage services, Filecoin has financial incentives to ensure files are reliably stored over time.
Notice how the last three weeks showed a possible reversal to the previous downtrend move. That ascending channel points to support at $ 90 in mid-November and resistance near $ 107, which would be a 55% gain from the current price.
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Partnerships and adoption could pave the way to $ 100
On September 14, Filecoin announced a referral program for users bringing members with data sets greater than 90 Terabytes. The network reached 9,000,000 Terabytes in August, and according to its website, there are more than 3,000 storage systems and providers offering capacity for more than 400 applications.
On October 13, Filecoin announced a storage collaboration with Flow Blockchain, which is supported by Dapper Labs. The service will establish a decentralized data warehouse for non-fungible tokens (NFTs), along with the multimedia assets associated with them. Flow's platforms include Eternal, Starly, Versus, and the upcoming online multiplayer game Chainmonsters.
More importantly, on October 15, the daily launch of Filecoin tokens will decrease by 23.8% to mark one year since the launch of the mainnet. Specifically, that affects the 7.5% stake held by early investors, equivalent to 150 million FIL tokens after the three-year issue period.
Since September 30, Filecoin futures open interest has risen by 45%, indicating that investor interest is finally starting to pick up. This metric represents the total number of contracts in play, regardless of whether they have actually been traded on a specific date.
Glass half full: the financing rate has room for buyers' leverage
To assess whether the market is leaning higher, you must analyze the funding rate for perpetual contracts. Although the open interest of buyers and sellers coincide at all times, the leverage can vary. When (long) buyers demand more leverage, the finance rate turns positive. Therefore, it is they who pay the fees to the (short) sellers.
However, the opposite situation occurs when shorts require additional leverage, and this causes the financing rate to turn negative.
The chart above shows a short period of excessive leverage from (long) buyers in early September as the finance rate reached 0.10% or 2.1% per week. More recently, Filecoin's funding rate surpassed 0.06% every 8 hours as the FIL token struggled with the $ 80 resistance on October 8, but failed to break through.
Derivatives metrics currently show little sign that investors have ditched Filecoin despite its price being 70% below the all-time high of $ 238. The recent partnership with Flow Blockchain, increased usage and ability to trade the network, and the reduction in token issuance point to a possible continuation of the uptrend of the previous three weeks. Nothing seems to stop FIL โโfrom reaching the $ 90 to $ 107 range in November.
The views and opinions expressed here are solely those of the Author and do not necessarily reflect the views of Cointelegraph. Every investment and trade movement involves risk. You should do your own research when making a decision.
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