FTX Token (FTT) has been moving upwards over the past two days. The price could soon confirm a long-term bullish reversal.
The price of FTX Token (FTT), the native token of the FTX exchange began an upward movement on news of the exchange’s acquisition of bankrupt digital lender Voyager’s assets for $1.42 billion.
All signs point to breakout from long-term resistance
FTT has been falling underneath a descending resistance line since reaching an all-time high price of $85.74 in Sept. 2021. However, the weekly chart is decisively bullish for several reasons.
Firstly, the price has created a double bottom inside the $24 horizontal support area. The double bottom is considered a bullish pattern, meaning that it leads to breakouts the majority of the time.
Secondly, the pattern has been combined with bullish divergence in the RSI (green line) Such divergences in the weekly time frame often lead to significant upward movements. Additionally, the RSI has broken out from its bearish divergence trend line (black).
Finally, FTT seems to have completed an A-B-C corrective structure, in which waves A:C have had an exactly 1:0.618 ratio. This is the second most common ratio in such corrections.
Therefore, all signs point to an eventual breakout from the long-term descending resistance line. If one occurs, the closest resistance area would be at $46, created by the 0.382 Fib retracement resistance level.
Daily chart also looking bullish
The daily chart supports the findings from the weekly one. Measuring from the June bottom, it shows that the price has completed a five-wave upward movement, which took the shape of a leading diagonal.
Since then, it seems to have completed an A-B-C correction structure, in which waves A:C have had a nearly 1:1 ratio. The fact that the movement has been contained inside a descending parallel channel and the bullish divergence in the RSI (green line) support this possibility.
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