According to crypto analyst Alan Santana, Cosmos is currently between a rock and a hard place in the market. In his opinion, this is a very favorable time for long-term investors, especially those who are optimistic.
He believes that ATOM shares are currently trading at a significant discount to their all-time highs, creating a very attractive risk/reward profile. According to Santana, Cosmos has a “great chart” as the coin is trading very low compared to historical prices.
✴️ Cosmos (ATOM) Accumulation Zone and Bull Market Strategy Until 2025
Cosmos has a great map…
How are you, my dear friend?
Ready for a new yesterday, tomorrow and today?
Are you ready to explore this map with me on this wonderful day?Cosmos has a great map because it… pic.twitter.com/SH4yrF76yd
— Alan Santana (@lamatrades1111) August 14, 2024
Space: accumulation phase and risks
Santana emphasized that Cosmos is in a critical accumulation phase. On the other hand, ATOM has historically made higher long-term lows, which could be a technical indicator laying the groundwork for future gains.
However, accumulation comes with risks. A key level to watch will be $1,923, the low since March 2020. If ATOM price falls below that threshold, it will somewhat undermine the bullish narrative that Santana presents.
This decline could be interpreted as a change in market sentiment and lead to weaker performance compared to other cryptocurrencies.
Another pressure on ATOM comes from insider selling. Once developers, miners, or exchanges start selling their assets en masse, it usually becomes a red flag indicating problems with the project, or at least a lack of faith in its future prospects.
This may be why Cosmos is struggling to stay afloat compared to other altcoins that have managed to hold above their June 2022 lows.
Bearish Outlook and Market Sentiment
While Santana’s sentiment is a bit overly optimistic, market sentiment is overwhelmingly bearish. According to the latest CoinCodex forecast, Cosmos will lose 8.56%, with its price falling further to $4.13 by September 15, 2024.
All technical indicators in this forecast are bearish. The Fear and Greed Index finally reached 27, indicating a lot of fear in the market. Cosmos has had nine green days in the last 30 days – out of a possible 30.
This represents a positive return of 30%. The current price volatility is 11.64%, indicating a highly uncertain and risky time frame.
Well, given the current state of the market, it may not be the best time to invest in Cosmos. Based on the factors mentioned above, namely the forecast for a price drop and the current sense of fear in the market, it seems that caution is warranted.
Weighing the risks and benefits
While Santana’s analysis suggests that this could be beneficial for future earnings, the outlook is not so promising at the moment. Therefore, an investor should consider these factors before buying.
Cosmos is a high-risk, high-reward scenario. The current low price and previous higher lows could provide huge rewards for long-term investors who can weather the storm. However, adverse sentiment, insider selling, and expectations for lower prices are risks.
Main image by Zipmex, chart by TradingView
