Cosmos (ATOM) surged 14%: Is it time for the market to reverse?

Cosmos (ATOM) is witnessing a strong price surge, rising over 14% in just the past 24 hours, as a series of technical indicators collectively signal positive prospects for continued growth. The Relative Strength Index (RSI) has escaped from the deep oversold territory and is approaching the overbought threshold, reflecting a noticeable increase in buying pressure.

On the Ichimoku Cloud chart, ATOM has just risen above the cloud, while confirmation crossovers of the uptrend have appeared – a sign that a reversal may be forming. As the price approaches a key resistance area, traders are closely watching to assess the likelihood of ATOM maintaining its current momentum and conquering the $6 mark in April.

The RSI index of Cosmos approaches the overbought area

Cosmos (ATOM) has just experienced a strong momentum breakout, with the RSI index soaring to 68.11 — an impressive jump from 29 just four days prior.

This rapid increase clearly reflects the surge in buying pressure that is rising sharply in the short term, indicating a significant reversal in investor sentiment. The RSI index, which ranges from 0 to 100, is a tool used to measure the speed and magnitude of price fluctuations. Typically, an RSI below 30 indicates that an asset is being oversold and may recover, while a level above 70 warns of overbuying and the risk of a correction.

The RSI index of ATOM | Source: TradingViewCurrently, the RSI of ATOM is approaching the overbought threshold, suggesting that the recent uptrend may be nearing saturation — at least in the short term. While breaking above the 70 mark could lead to a stronger growth cycle, the high RSI level also serves as a reminder to be cautious: profit-taking pressure could emerge at any time, and traders may start to reconsider their strategies.

If the momentum continues to be maintained, ATOM could completely break into the overbought zone and extend the upward trend. However, if the buying pressure weakens, the market may witness a slight correction to “cool off” after the recent surge.

Ichimoku Cloud chart for ATOM shows bullish setup

Cosmos is showing strong breakout signs on the Ichimoku Cloud chart, as the price has risen above the cloud – an important technical indicator that often suggests a potential trend reversal to bullish.

The blue conversion line ( Tenkan-sen ) has strongly turned upward and is currently above the red baseline ( Kijun-sen ), forming a typical bullish crossover – often seen as a confirmation signal for short-term upward momentum.

The Ichimoku Cloud index on the ATOM/USDT 4-hour chart | Source: TradingViewThis structure reflects an increasing buying momentum and may continue to support the upward trend if maintained steadily.

Notably, the upper edge of the blue cloud Leading Span A ( has started to curve upward, while the lower edge of the red Leading Span B ) is moving horizontally. This shift makes the cloud in front thinner – a signal indicating that selling pressure is weakening.

Combined with the price holding steady above the cloud and the lagging line (Chikou Span) having broken free from the resistance zone of past prices, the overall technical picture is clearly leaning towards the bulls.

Will Cosmos reach $6 in April?

With the recent recovery momentum, Cosmos (ATOM) is approaching a key resistance level around $5. If it successfully breaks through this area, the price could extend its upward trend to the next levels at $5.5 and even $6.

! 4-hour frame ATOM/USDT chart | Source: TradingView The (EMA) exponential moving averages are currently aligning in a positive direction, reflecting the consolidating uptrend. Notably, a “golden crossing” — when the short-term EMA crosses above the long-term EMA — is showing signs of forming. If this pattern is confirmed along with increased trading volume, the market may witness stronger buying, thereby enhancing the possibility of a breakout and continuation of the uptrend.

However, in a scenario where the price cannot break through the resistance level and is rejected, selling pressure may cause a trend reversal, bringing ATOM back to important support areas.

The first area to pay attention to is the region around $4.83 - if this level is broken, the downward momentum could extend to lower levels such as $4.47 and $4.17.

Disclaimer*: This article is for informational purposes only and is not investment advice. Investors should do their own research before making any decisions. We are not responsible for your investment decisions.

• Nubank, backed by Berkshire, adds ADA, NEAR, ATOM, and ALGO to its cryptocurrency portfolio.
• The correlation between Bitcoin price and M2 money supply signals a positive outlook for Q2.

SN_Nour

@media only screen and (min-width: 0px) and (min-height: 0px) { div[id^=“wrapper-sevio-d89f58f5-7b63-40be-98c0-6b1fd62584fb”] { width:320px; height: 100px; } } @media only screen and (min-width: 728px) and (min-height: 0px) { div[id^=“wrapper-sevio-d89f58f5-7b63-40be-98c0-6b1fd62584fb”] { width: 728px; height: 90px; } }