Correction Sentiment Threatens Filecoin Price To Hit $5

The FIL price resonated within the symmetrical triangle portion of the pennant pattern for the past three weeks. The sellers triggered a bearish breakdown from this pattern in response to the recent sell-off in the crypto market. The resulting downfall plunged to $6.3 support, which has temporarily halted the current correction.

Key points: 

• The FIL prices have deprecated 37% in the last three
• The 20-day EMA is nearing a bearish crossover with the 50-day EMA
• The intraday trading volume in Filecoin is $478 Million, indicating a 28.6% gain

Source- Tradingview

Amid the last month’s recovery, the FIL/USDT technical chart formed a pennant pattern in the daily time frame. This bullish continuation pattern was supposed to accelerate the buying momentum to extend the recovery rally higher.

However, the recent news that the US Fed may increase the interest rate by 0.75% in September has caused quite an impact on the crypto market. As a result, similar to some other major cryptocurrencies, the FIL price witnessed a sudden sell-off.

This selling pressure triggered an unusual activity of bearish breakdown from the pennant pattern. The post-breakdown fall tumbled the FIL price 17.6% down. The altcoin currently trades at $6.64 and has recently breached an in-between resistance of $7.62 support. 

The FIL price is likely to revert higher to retest the pierced support. Thus, if the sellers sustain the price below the $6.64 flipped resistance, the altcoin may challenge the $6.28 support.

A candle closing below this level will undermine the July-end recovery and sink the prices back to the $5 bottom support.

Technical indicator

EMAs:  with the currency downfall, the coin price dropped below the 20-and-50-day EMA, offering an extra edge for short sellers. These slopes may flip to viable resistance and resume ongoing correction.

RSI Indicator: the daily-RSI slope has nosedived into bearish territory, indicating market sentiment has turned bearish.

ADX: the downsloping ADX slope indicates a loss of bullish momentum. 

• Resistance levels- $7.62 and $9.5
• Support levels- $6.28 and $5