Fantom, soon to be rebranded as Sonic, is currently facing a bearish outlook based on technical analysis. The daily chart for Fantom shows a strong bearish structure, with the price action recording a significant 52.6% loss over the past month. Despite these losses, there is a potential for a turnaround as Fantom prepares for a 1:1 token swap on Binance to introduce the new Sonic token S. This strategic move aims to position Sonic as a new layer-1 blockchain capable of processing 10,000 transactions per second, which could drive demand for the token in the near future.
The downward trend for Fantom prices has been consistent, with the initial rejection from the $1.44 level triggering a series of bearish movements. The Fibonacci retracement level at $0.659 provided temporary support, but sellers continued to dominate the market, pushing the price lower. The Relative Strength Index (RSI) has been below the neutral 50 mark for an extended period, indicating strong bearish momentum. Additionally, the On-Balance Volume (OBV) fell below November lows, signaling increased selling pressure in the market.
In addition to the OBV, the Open Interest for Fantom also reached a two-year low, reflecting a high level of selling pressure. The upcoming token swap from FTM to S could be a contributing factor to the decline in Open Interest, as traders may be liquidating their positions in anticipation of the swap. Exchanges have announced plans to delist FTM and introduce Sonic trading pairs, further impacting market sentiment.
In conclusion, while Fantom is currently experiencing a bearish phase, the upcoming token swap and the introduction of Sonic as a new blockchain platform could potentially drive demand for the token in the future. Traders should exercise caution and stay informed about market developments to make informed decisions.
Please note that the information provided in this article is for informational purposes only and does not constitute financial advice. Readers are advised to conduct their own research and consult with a financial advisor before making any investment decisions.