Cosmos (ATOM) has the potential to post significant gains in the coming weeks primarily because its longer time frame chart shows a bullish continuation pattern.
Bent "bull flag, "the structure appears as the asset trending downtrend as it bounces between two downward sloping trend lines. However, it eventually breaks out of range, in the direction of its previous trend, with a profit target on a long equal to the size of its previous uptrend, which is also known as the flagpole.
Therefore, in a "perfect" world, if ATOM is going to break above the upper trend line of the flag (with an increase in trading volume), it can increase as much as the height of the flagpole around above $ 35. This sets a price target close to $ 65 when measured from the current potential breakout point.
Almost 64% of ATOM's total supply is at stake
The bullish setup on ATOM appeared as the token is up more than 330% from its June low at $ 7.82 for this week they hover around $ 32.
The shortage of circulating tokens could be playing a role in driving buyers to market. Data obtained by Messari showed that almost 64% of ATOM's current supply is at stake.
According to the data, Cosmos investors have bet more than 180 million ATOM tokens to become validators in its 'Cosmos Hub', a proof-of-stake blockchain that constitutes one of the many hubs of the network. In return, users receive a portion of the network's transaction fees and lock in the rewards.
Pentoshi, Independent Market Analyst, indicated that the increasing number of ATOM tokens wagered has been instrumental in driving their price up.
The pseudonym Twitterati added that ATOM sellers have been losing momentum, citing two corrections during the fourth quarter that were halted midway due to increased buying pressure near the token's previous all-time highs.
According to the analyst, ATOM sees it clearly:
"Signs of absorption"
Related: 12/1 Price Analysis: BTC, ETH, BNB, SOL, ADA, XRP, DOT, DOGE, AVAX, SHIB
Avalanche fractal highlights ATOM's potential
Another analyst, known by the pseudonym 'Bluntz', anticipated that ATOM would continue its upward rally based on similar gains posted by one of its main blockchain rivals, Avalanche (AVAX), earlier this year.
Like Pentoshi, Bluntz sees the possibility of ATOM revisiting its previous record as a foundation to continue its bull run. In a similar setup, AVAX recovered by almost 250% after finding a solid foundation within the $ 50- $ 60 support area.
According to Bluntz, ATOM could easily reach $ 100 in the medium term.
The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and business move involves risk, you should do your own research when making a decision.
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