NOIDA (CoinChapter.com) — Crypto AI project Fetch.AI’s native token FET rallied nearly 19% to a new all-time high near $2.86 on March 7 before paring some gains to profit booking.
As FET reaches a new ATH followed the token’s more than 46% spike on March 6, Fetch.AI’s largest single-day gain in over three years. However, the token now faces a bearish cue that could wipe all of FET’s gains since late June 2020.
FET Forms Bearish Wedge Pattern
The Fetch.AI token’s price has formed a bearish technical pattern called the ‘Rising Wedge.‘
The pattern forms when an asset’s price consolidates between upward-sloping support and converging resistance lines resembling a wedge. Declining trading volumes often accompany a breakdown below the pattern.
The price target of the pattern is equal to the height of the back of the wedge. If the Fetch.AI token price breaks below the bearish pattern, the token might fall to the theoretical price target of $0.03, a drop of nearly 99% from current levels.
However, such drastic price drops are rare, and Fetch.AI developers would have to essentially shoot themselves in the foot to achieve such a milestone. Given the bullish cues that the project is gathering might help FET price invalidate the pattern.
For instance, Fetch.AI announced the launch of Fetch Compute after a $100 million infrastructure investment. The FET team stated it would leverage Nvidia GPUs to enhance developers’ computing power, which could boost ecosystem growth for the Fetch.AI token.
The program would provide developers and users access to advanced Nvidia GPUs, including H200, H100, and A100. Furthermore, the initiative also incorporates a system that rewards users with credits for staking FET.
FET Reaches ATH, Then Corrects
Meanwhile, FET price pared gains after charting its new ATH following the token’s 95% rise in March 2024. A correction after posting a new ATH is common as traders start selling to book profits.
Moreover, the relative strength index or the RSI for FET remains overbought, clocking a value of 90.88 on the daily charts. The RSI is a momentum indicator for measuring asset price movements to identify overbought or oversold conditions.
Overbought RSI levels and upward-moving average trendlines indicate a strong presence of bulls in the market. However, traders often consider an overbought RSI level a bearish signal since the occurrence usually precedes a bearish reversal or consolidation phase for the underlying token.
As such, a correction would likely force FET price to the support near $2.05. Moreover, breaking below the immediate support level might cause the Fetch.AI token price to drop to the 20-day EMA (red wave) support near $1.5 before recovery.
Conversely, an uptrend would likely push FET into price discovery, where the token could face resistance from the 0.382 Fibonacci level near $3.17. However, breaking past the immediate resistance could help FET price target the resistance near $3.8.
