Over the course of 24 hours, THORChain’s [RUNE] value surged by 17.15%, instilling a sense of bullish optimism across the cryptocurrency sphere following Bitcoin’s [BTC] achievement of a new record high against the U.S. Dollar at $75.4k.
Monday’s market volatility triggered a strong bearish reaction initially, but the bulls swiftly stepped in to alleviate concerns of a prolonged downturn.
Despite the price surpassing the $4.76 mark, which appeared promising for the short term, the question remains whether the bulls can capitalize on this momentum.
THORChain Sees Disruption in Bearish Market Pattern
On the daily chart, RUNE had been on a consistent upward trajectory since suffering significant losses in August, maintaining a bullish market pattern until November 4th.
Bitcoin [BTC] experienced some turbulence, sliding to $66.8k after being rejected at $73.6k just six days earlier.
This rejection triggered substantial selling pressure on RUNE, causing prices to plummet from June’s bearish zone of $6.3 to $4.22 within a week.
This represented a 33.3% decline and altered the market structure to a bearish stance.
Of concern was the breach of the support level around $4.5 that THORChain had established over the previous month. However, the On-Balance Volume (OBV) remained within a narrow range, indicating that RUNE was likely to fluctuate within the $4.5-$6.3 range.
Indications of an Impending Consolidation Phase
Analysis of the liquidation heatmap revealed that the accumulated liquidity around $4.5 was wiped out during the recent market correction.
The rapid recovery from this level suggested that the rebound was fueled by liquidity rather than a wave of intense selling activity in the spot market.
Currently, there isn’t a clearly defined liquidity pool to attract RUNE. Although the $5.8-$6.2 range could be of interest and may drive prices higher, it is unlikely to happen immediately.
It seems more probable that THORChain will consolidate below $6, giving time for short liquidations to rise before making an upward move to trigger them.
Disclaimer: The opinions expressed in this article do not constitute financial, investment, trading, or any other form of advice; they solely reflect the writer’s perspective.