Filecoin consolidates above $3.1, what next

Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion.

• FIL breached the $3.2 short-term support. 
• Open Interest rates wavered in the last few days.

Filecoin [FIL] was poised for a short-term, narrow-range extension as it waits for a clear Bitcoin [BTC] direction. The recovery seen at the end of August was forced to a reversal at $3.56. The drop cracked a key short-term support of $3.2 but eased at a weekly bullish order block (OB).

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Will bulls see a reprieve?

Source: FIL/USDT on TradingView

The 4-hour chart market structure was bearish after dropping below the previous low and support of $3.2. A bullish bias could only suffice if FIL climbs above $3.56. 

In the meantime, FIL consolidated recent losses above $3.1. The plunge eased at a weekly bullish order block (OB) of $2.68 – $3.12 (cyan). 

A recovery could be imminent if the weekly candlestick closes above $3.2 and Bitcoin [BTC] recovers recent losses. Northward, the key resistance levels are $3.56 and $3.80.

Alternatively, the narrow, short-term range between $3.1 – $3.2 could extend in the next few hours/days if BTC overstays within its range lows near $25k. 

Meanwhile, the RSI attempted recovery from the oversold zone but didn’t cross the 50 mark, illustrating muted buying pressure. But the CMF crossed above zero mark, showing capital inflows improved slightly. 

Open Interest rates wavered

Source: Coinglass

In the last few days, FIL’s Open Interest (OI) rates wavering suggested a likely range extension in the short term. The metric has fluctuated below $70 million in the last few days, indicating demand for FIL wavered over the same period. 

How much are 1,10,100 FILs worth today?

Besides, FIL’s OI-weighted funding rate fluctuated in September while the derivatives market volume tanked massively. The inference from above is a neutral to negative sentiment in the short term. 

But the sentiment can flip swiftly, especially if BTC reclaims $26k and surges forward. So, tracking BTC price is key.