Kaspa dropped after rallying up to $0.21. Where will KAS be heading next?

• Kaspa’s rising triangle pattern, as it appeared at the time of publication, suggested an optimistic sentiment.
• KAS may surpass its previous high of $0.201. 

Kaspa [KAS] has remained stagnant for the past month, with the token only making a slight market movement—a 0.95% increase in price over the week.

A press-time chart showing an ascending triangular formation suggested KAS could be poised for a rally which would propel it above $0.21.

A bullish chart pattern, an ascending triangle has a horizontal upper line that acts as resistance while a rising bottom line serves as support. The setup can lead to an upward breakout.

KAS in the ascending triangle

KAS reached $0.21 as a recent high, breaking above the upper resistance of the triangle. It could not hold this position and fell back to the triangle, breaking the base support.

This price action, often referred to as ‘wicking,’ is typically seen as a stop hunt—a strategy used to manipulate the market in favor of major players.

This stop hunting strategy was intended to help buyers. It drove the price lower to encourage bullish traders to place stop loss orders.

It allowed investors to buy at lower rates and then push the prices up again.

The upward trend has been slow, but this pattern is very common. It shows a gradual rise followed by a sudden increase.

AMBCrypto’s technical analysis shows that, as this scenario develops, indicators such as MACD and RSI show a bullish trend, indicating the possibility of an upcoming rally.

There are more bullish trends emerging

As the Moving Average Convergence Differece (MACD) indicator slowly moves from negative territory, there is a sign that the expected rally in the ascending triangle may be imminent.

MACD (moving average crossover indicator) is a momentum indicator which displays a relationship between the two moving averages for an asset.

Close examination of the chart shows a move towards the positive, as the blue MACD is approaching the crossover over the orange signal, signaling the potential for a bullish turn.

TradingView

The bulls will also be able to confirm their dominance by a faster crossing of the orange and blue lines.

RSI (Relative Strength Index), another momentum indicator which can range from 0 to 100%, supported this bullish forecast.

The RSI is a measure of overbought and oversold situations.

An RSI of 46.39 suggests that the bullish trend is gaining momentum, which could drive KAS’s price upward. It indicates that buyers are ready to take the market higher.

Mixed feelings on the chain

Kaspa: An Analysis transaction volume via Santiment A significant drop was revealed: From $552.44 on the 5th, to $66.82 only on the 7th. 

The price of KAS could fall further due to this notable drop.

Santiment

Moreover, liquidation statistics from Coinglass From the 7th through the 14th August, a growing number of long-term traders on KAS liquidated their positions. 

This usually indicates a notable price drop, resulting in the automatic closure of these long positions due to insufficient margin to cover the losses—a clear sign of a bearish trend.

Coinglass

Both the concurrent drop in volume and price indicated a bearish mood and possible extended downtrend due to reduced trading activity.

The Open Interest (OI), weighted funding rate, however, offered a more bullish outlook, remaining at 0.0140%, and indicating an increase.

The rate indicated that those who held long positions paid a premium to those with short positions. This indicates heightened demand for the asset and an optimistic outlook.

Coinglass

You can read more about it here Kaspa’s [KAS] Price Prediction 2024-25

These contrasting indicators suggest that the market will soon gain clarity, and adjust to either a bearish or bullish bias.

KAS’s previous record of $0.21 could be broken if the market is bullish. This would set a new high.