Market Analysis of Bittensor (TAO)

TAO broke below the $434 and $354 support levels and might continue to decline in the coming weeks.
The liquidation heatmap indicates that a bounce to $390 is likely.

Bittensor (TAO) bulls have struggled to maintain the $440-$480 support zone over the past month, with prices retesting resistance ten days ago. Since those local highs, TAO has experienced a 26.7% drop.

Volatility has increased over the last two weeks as Bitcoin (BTC) fluctuates around the $100k mark. The overall bearish sentiment in the altcoin market has negatively impacted TAO, which has been on a downward trend since December.

TAO Falls Below $354 But Quickly Recovers

Bollinger bands have indicated increased volatility since the second half of November, resulting in more rapid price movements compared to August. Although there was an attempted uptrend in November, TAO’s market structure has shifted to bearish.

In January, bulls gave up the $434 support level, which was significant on the weekly timeframe. With $354 and $216 marking the next key support levels, TAO has recently closed a session below $354 but bounced back by 14% from local lows. However, this is likely a shallow bounce before further declines.

The Average True Range (ATR) supports the volatility indicated by the Bollinger Bands, emphasizing selling pressure and the bearish structure, suggesting more lows ahead.

Upcoming Insights

The one-month liquidation heatmap reveals a cluster of short liquidations forming around the $380-$400 region, coinciding with local highs during the recent market fluctuations. A continued lack of demand and the prevailing bearish structure suggests that a rejection from the $400 resistance zone is probable. Swing traders might consider waiting for a test of that region before opting to short.

Disclaimer: This information does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion.