ATOM has been increasing since September 8. Until now, it has almost tripled in value, having increased by 180%.

The increase was gradual until November 1st when the rate of increase intensified. However, ATOM has probably reached a resistance area and a period of retracement is likely.

Cryptocurrency trader @cryptorangutang suggested that the ATOM chart is one of the best looking charts in the cryptocurrency industry at the moment, and will soon break out.

Will the price do so? And if yes, how high will it increase? Continue reading below if you are interested in finding out.

Ascending Support

The ATOM price has been following an ascending support line since reaching a low of 18,000 satoshis on September 5.

The price moved above the 40,000 satoshi resistance area without much trouble and afterward validated it as support. The flip of the previous resistance as support is considered a bullish movement. The price is currently inside the second resistance area at 52,000 satoshis.

ATOM Price Movement

However, the chart has begun to show weakness.

First, volume has been constantly decreasing and is almost non-existent on the latest upward move.

Second, both the RSI and the MACD have begun to develop significant bearish divergence. This suggests that the price might not be successful in breaking out. Rather, it could decrease to the ascending support line before possibly making another attempt at breaking out above resistance.

Bearish Divergence

ATOM Future Movement

The immediate upside for ATOM seems limited since there are strong resistance areas at 65,000 and 80,000 satoshis.

It would be healthier if we had a decrease to the support line or even a breakdown to the 100-day moving average before the price continued its upward movement.

ATOM Price Decrease

To conclude, the ATOM price is close to breaking out above a significant resistance area. However, due to the weakness shown by several technical indicators, we believe a retracement is likely before the price makes another attempt at moving higher.

Disclaimer: This article is not trading advice and should not be construed as such. Always consult a trained financial professional before investing in cryptocurrencies, as the market is particularly volatile.

Images courtesy of Shutterstock, TradingView, Twitter.

The post Does ATOM Have Enough Strength for a Breakout? Analyst Makes His Case appeared first on BeInCrypto.

Source: Be In Crypto