- Cosmos price is consolidating within a bullish pennant pattern and is targeting an 85% rebound.
- ATOM needs to clear the 12-hour supply zone between $ 26.18 and $ 28.64 for an optimistic outlook.
- A critical close below $ 16.37 will invalidate the bullish outlook.
Cosmos price delayed its rise due to the recent market crash, but the bulls are resilient and have already started the rally.
The Cosmos Prize is about to be confirmed for another rally
Cosmos price began its multi-month consolidation with lower highs and higher lows forming, after rising nearly 530% since 2021. While the initial surge in ATOM market value formed the flagpole, the following range-bound move is known as the pennant.
Collectively known as the bullish pennant, the technical formation predicts an 85% bull rally, which is determined by adding the height of the flagpole to the breakout point at $ 22.62.
With this move, the Cosmos price is at $ 41.66, a new all-time high.
This bullish outlook is supported by a 38% increase in the ATOM price after yesterday’s decline. Such a quick reversal indicates that buyers are scooping the altcoin at a discount.
Although a critical close above the pennant’s upper trendline at $ 22.62 signals a breakout, secondary confirmation will arrive after ATOM price clears the supply zone, which extends from $ 26.18 to $ 28.64.
Crossing the resistance level at $ 35.2 is critical for Cosmos price to hit its intended target at $ 41.66.
ATOM / USDT 1 day chart
On the flip side, a transition to the lower bound of the consolidation phase seems likely if buyers are rejected at the upper trendline of the pennant or in the supply zone. If ATOM cuts through the $ 16.37 to $ 18.02 demand zone to produce a daily candlestick just below that, the bullish thesis will be invalidated.
Given these conditions, market participants can expect Cosmos price to initiate a new downtrend to $ 15.7, which is the low of yesterday’s crash, or $ 15.10.