The price of Fantom (FTM) is at risk of falling back in February due to a growing divergence between its price and momentum in recent weeks.
FTM price jumps 230% after Cronje's 2023 roadmap
The FTM price has grew 230% in the last five weekstrading at $0.61 on February 5. The rally came as part of a broader crypto market recovery, but outperformed most top-ranking crypto assets due to the hype created by Andre Cronje.
Cronje is the co-founder and architect of the Fantom Layer 1 blockchain. On December 26, 2022, the developer threw a letter discussing goals and priorities for the Fantom ecosystem in 2023, including their intention to allow decentralized app developers to earn 15% of the network's revenue.
The FTM price has seen five weeks of gains in a row since Cronje's letter to the Fantom Foundation team.
The FTM/USD pair looks set to close out the week ending February 5 with at least 25% gains, helped by Cronje's latest Twitter. thread that gives 13 reasons why Fantom will be one of the best layer 1 blockchains in 2023.
Fantom Price Technical Data Hints at a Correction Ahead
However, the ongoing FTM rally is at risk of exhaustion due to a growing bearish divergence between its rising price and its falling momentum.
On the daily chart, FTM/USD has made higher highs since mid-January, while its Relative Strength Index (RSI) has made lower highs. As a rule of thumb, such a discrepancy means that the bullish momentum is slowing.
Furthermore, the RSI remains above 70, which suggests that FTM is "overbought". It also suggests short-term bullish exhaustion and possible sideways or bearish price action in the coming days.
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FTM risks falling to $0.42, or 35% of current price levels, given the level's recent history as resistance. Furthermore, a close below $0.42 would put the FTM 200-day exponential moving average (200-day EMA; the blue wave) in sight at $0.38 as the next downside target.
In general, Fantom maintains its bullish bias as long as it stays above its 200 day EMA and 50 day EMA (the red wave).
This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should do their own research when making a decision.
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