FIL pumps up 70% on Filecoin in 7 Days – China buying Filecoin?
Filecoin, the leading decentralized storage protocol Filecoin, achieved a stunning 75% rally during the weekend.
This is a half-year of price suppression for the cloud-storage asset once prized.
Filecoin currently trades at $8.59 ( 1.45% over the last 24 hours).
The consolidatory price action, which had been ranging from $5.00 to $5.50 for more than a month, saw a massive breakout on February 17.
Friday night arrived and hammering candles began to spread across the chart. This was due to the Bitcoin (BTC), $24,500 increase last week.
The rally went on all weekend, until it stopped at $10 on Sunday.
This level has not been seen since August 2022, more than six years ago.
FIL is determined to reclaim the $10 mark. This is a major target, as it is now down to just one digit, which is a serious fall from grace for a coin that was once trading at $237.
The bulls are trying to consolidate their gains and gather support locally, as the price action has been erratic for the last 24 hours.
Consolidation seems to be gaining traction around $8, a slight retracement of -10% at the top.
Bullish sentiment is evident with price action held steady at the top of FIL’s trading channel.
Filecoin (FIL), could rally higher
This theory is challenged by the fact that indicators are used.
RSI 14 pushed the limits as it heated up during weekend rally. This was clearly an overbought signal, hitting a frightening top of 85
Things have not slowed down. Despite the support consolidation and the local retrace, the RSI has not cooled significantly. It is currently at 76.
This signal is clear and bearish. It could indicate a fall-down to the lower support trendline. In almost a week, the lower trendline has not been tested.
This angle is further strengthened by Filecoin’s MACD. The indicator also shows bearish divergence. The MACD has dropped from its highs of 0.162 at the weekend to -0.023 today, thanks to the local retrace.
Despite the bullish rally and Filecoin’s historically-demonstrated upside potential, localised action seems to signal the potential for a breakdown to test support further.
This is a significant downside risk. A fall at the $5.50 support level will likely result. This would be a move of -34.96% to the downside.
There is upside potential for $10 to flip to support. Historical resistance levels starting in May 2022 suggest that $11.50 could be the next stop ( 35.98%).
Filecoin’s risk: reward ratio for a short time frame (STF), is 1.03. This is a 50/50 chance toss-up, with upside potential and downside risks roughly equal. Waiting for a better entry could be worth it.
Filecoin (FIL), why is it exploding so fast?
The notion of a Chinese crypto narrative has overtaken the crypto markets in the last two weeks.
Investors have rushed to buy ‘Chinese Coins’ due to growing macro sentiment around regulatory easements for cryptocurrency in Hong Kong (VASPs), and the Chinese government’s tease of imminent quantitative easing.
In fact, large liquidity injections by China’s People’s Bank have coincided with an increase in Chinese crypto projects.
Consequently, popular crypto projects have soared with Chinese developers teams, with Filecoin, Polkadot, and VeChain all posting impressive rallies over the weekend.
However, this story could be erroneous.
Tencent (Chinese), the largest videogame company in the world, fired its entire metaverse division last week. 300 employees were laid off just months after a multibillion dollar investment.
This is despite repeated crackdowns by Beijing against crypto. This has been a goal of the company. Two birds, one stone The Chinese ban on Bitcoin is a blow to the crypto industry. It asserts the dominance of the new digital currency, the China Bitcoin CBTC, and reduces the pressure on an already stretched national power grid.
What is Filecoin (FIL?
Filecoin The 2021 bull market saw (FIL) make headlines as it rose to eye-watering levels above $200.
This has made FIL a top-ranked cryptocurrency based on market capital, currently ranking 22nd.
This protocol allows users to rent storage space from their own devices using a decentralized protocol. Open-source code was used to build this ‘cloud’. It is intended to be a decentralized, distributed data center that can compete with heavily centralized players.
Three key mechanisms make up the Filecoin network: storage mining (offering storage), retrieveal mining (processing queries across the network), as well as clients who lease storage space.
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Is it a good time to buy Filecoin now?
FIL may see a significant rally in the near future, but it could take several months. We’ve reviewed the top 15 cryptos for 2023 as evaluated by The Analysis Group. CryptoNews Industry Talk team.
This list is updated every week with new altcoins or ICO projects.