In the ongoing market recovery, TAO, the native token of Bittensor, appears bullish and is poised for a massive upside rally due to its strong price action. With two big green candles, TAO has recently broken out of a strong descending trendline that it has been facing since the beginning of December 2024.
TAO Price Action and Upcoming Level
Following the breakout, TAO appears to be transitioning from its prolonged bearish trend into a bullish phase. However, before this shift fully occurs, the asset is facing mild resistance from the 200 Exponential Moving Average (EMA) and the horizontal level at the $475 mark.
Based on historical price momentum, if TAO breaches this hurdle and closes a daily candle above the $490 level, it could soar by 46% to reach the $720 level in the future.
However, the asset’s Average Directional Index (ADX) currently stands at 21 and appears to be declining, suggesting that TAO lacks strong momentum, making it difficult for the asset to sustain its rally.
$4.52 Million Worth TAO Dumps onto Exchanges
Despite these bullish price movements, long-term holders have been offloading the asset, as revealed by the on-chain analytics firm Coinglass. Data from spot inflow/outflow shows that exchanges have witnessed an inflow of $4.52 million worth of TAO tokens during the recent upside momentum, indicating a potential sell-off.
Such inflows into exchanges can create selling pressure and lead to a price drop. However, the sentiment and market structure are different in this case, which could pose a challenge for the asset to rally in the coming days.
Rising Open Interest
Whereas, TAO’s Open Interest (OI) has soared by 27% in the past 24 hours, indicating traders’ strong interest and confidence in the asset.
At press time, the over-leveraged level is $435.9 on the lower side where bulls have held $7.71 million worth of long positions, while $473 on the upper side, where bears have held $5.05 million worth of short positions. This liquidation level clearly defines that the bull is the one who is currently dominating the asset.
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