Fantom (FTM) Price Risks Reversal in February due to the increasing divergence between its price and the momentum of the last few weeks.
FTM Price Jumps 230% Following Cronje’s 2023 Roadmap
FTM price has grown 230% in the last five weekstrading at $0.61 on February 5. The rally came as part of a broader cryptocurrency market recovery.but outperformed most major crypto assets due to hype created by Andre Cronje.
Cronje is the co-founder and architect of the Fantom Layer 1 blockchain. On December 26, 2022, the developer published a letter discussing the goals and priorities for the Fantom ecosystem in 2023, including its intention to allow decentralized app developers to earn 15% of network revenue.
Since Cronje’s letter to the Fantom Foundation team, the FTM price has recorded five consecutive weeks of gains.
The FTM/USD pair looks ready to close the week ending February 5 with at least a 25% profithelped by the last thread from Cronje’s Twitter giving 13 reasons why Fantom will be one of the best layer 1 blockchains in 2023.
Fantom Price Technical Data Points to a Future Correction
However, the ongoing FTM rally is at risk of petering out due to a growing bearish divergence between its rising price and its downward momentum.
On the daily chart, the FTM/USD pair has made higher highs since mid-January, while its Relative Strength Index (RSI) has made lower highs. As a rule of technical analysis, such a discrepancy means that the bullish momentum is slowing down.
Besides, the RSI remains above 70which suggests that FTM is “overbought”. It also hints at a short-term bullish exhaustion and one possible sideways or bearish price action in the next few days.
FTM is at risk of going down towards $0.42, or 35% from current price levels, given the level’s recent history as resistance. Furthermore, a close below $0.42 would make the FTM 200-day exponential moving average (200-day EMA; the blue wave) at $0.38 the next bearish target.
In a nutshell, Fantom will retain its bullish bias as long as it stays above its 200 day EMA and 50 day EMA (the red wave)..
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