- FIL declined to oversold levels in the recent market decline.
- Bull pennant technical setup could lead to FIL/USDT jumping up by more than 50% from current prices.
- Filecoin fundamentals also point towards a developing bullish momentum.
KOLKATA (CoinChapter.com) – Bullish traders/investors look to pump Filecoin’s native token FIL up by more than 50% from current prices. The token’s oversold market conditions and an underlying bull pennant technical formation point to an impending rally to $130 and beyond.
What Is Filecoin?
Filecoin is a decentralized peer-to-peer network that pays for the safe, reliable, and secure storage of files. Storage miners in the network store files of users in exchange for payments (in FIL tokens). Apart from storing, storage miners are also responsible for providing proof of proper file storage over time.
“Anyone who wants to store their files or get paid for storing other users’ files can join Filecoin. Available storage, and the price of that storage, is not controlled by any single company. Instead, Filecoin facilitates open markets for storing and retrieving files that anyone can participate in.”
Filecoin introduction documents
The Filecoin blockchain maintains a ledger of FIL transactions, along with proofs from storage miners that they are storing their files correctly.
Related: The9 Purchases $2 Million In Filecoin Mining Machines As Institutional Investors Show Support
Storage Collaboration With Flow Blockchain
As per an October 13 announcement, Filecoin will function as the official storage partner for the Flow blockchain.
“This integration of technologies will accelerate end-to-end ownership of NFTs, along with the media assets associated with them, establishing decentralized storage of data on Flow.”
read an excerpt from the announcement blog
Flow platforms like Eternal, Starly, and Versus already leverage Filecoin’s peer-to-peer file storage system. The integration will allow future Flow applications to protect NFT media assets and metadata easily.
Filecoin’s deep NFT involvement with Flow is a definite precursor that will shape its recovery path in the future, along with a few technical factors, of course.
FIL: Oversold And Primed For A Breakout
After a 5X recovery from lows near $40 to $120 on September 5, 2021, the FIL/USDT pair buckled under bearish forces. The token declined by nearly 60% to lows near $50 before inching up again in October, buoyed by bullish pressure. But lackluster buying interest restricted the FIL/USDT below $100.
However, the pair’s recent price action triggered a bull pennant formation. In detail, the bullish technical setup indicates that FIL is gearing up for an explosive upside breakout move in the near term. Combining the declining upper trendline and rising lower trendline implies that selling momentum is nearing exhaustion.
With the pennant height equalling $70, an extrapolation pushes up the FIL/USDT pair to $133, a 52% appreciation from current prices at $63.
Also, at 35.89, the relative strength index (RSI) figure for the FIL/USDT pair is well within the oversold region. In technical analysis, a 30-50 RSI range invites fervent bullish price action indicating significant gains for the asset, adding to the developing bullish sentiment.
