ATOM has reached March 2020 levels after losing an important support level at $3.80. Although the token has reached these low levels not seen during the last six years, the rounding bottom on shorter time frames could mean that the token could recover.
As shown in the weekly chart below, ATOM has reached a low level, which was last seen approximately half a decade ago. The token started its downtrend after the last bull run in 2021, when the ATOM reached nearly $45. Ever since then, although there were short bursts of rallies, there was nothing major that could stop the crashing prices.
ATOM freefalls from $45 to $7
Unlike other tokens, ATOM’s crash was not gradual. It was very close to a free fall. After reaching around $45 in early 2022, the token crashed within six months, reaching prices around $7. Thereafter, the bulls tried pushing the price higher on multiple occasions but were only able to push the prices as far as $16. And as days went by, the strength of the bulls started to wane. As such, all the highs that came after were lower than the previous highs.
Although the bulls could not push the prices higher and make higher highs, they were holding strong at the support near $3.8 until recently. However, with the geopolitical tensions and the bearish market sentiment, ATOM lost this major support and is currently priced at $1.86, March 2020 low levels.
ATOM forms rounding bottom, a classic sign of reversal
With the prices at these low levels, there is belief in the crypto community that ATOM is bottoming. For instance, when observing the 4-hour time frame chart, ATOM is producing a round bottom. Technically a round bottom forms when the selling pressure is reducing and then the price starts to move sideways as accumulation begins. And thereafter, slowly as the buyers outnumber the sellers, ATOM will start to rise along the curve as shown in the chart.
Even the relative strength index indicator is making higher highs, showing that ATOM is gaining bullish momentum and a reversal is around the corner.
