Short squeeze or bull trap? Cosmos crypto tests $1.50 resistance

At the time of writing, the moving averages formed a bullish crossover, and the Cosmos crypto price has also climbed above the averages.

The MACD was also climbing toward the zero line, showing weakening bearish momentum and a potential recovery higher.

While the MACD was unable to climb toward the early July highs, the CMF managed to break out past the +0.05 mark to signal strong capital inflows.

Despite the mixed signals on the daily timeframe, there was one warning sign to watch out for.

Traders’ call to action- Beware of a liquidity sweep

The 4-hour chart’s structure was also bearish. The Fibonacci retracement levels showed that the Cosmos crypto token was trading within the golden pocket between $1.46 and $1.53.

A rejection from the $1.50 resistance zone is expected, based on this structure.

The 1-month liquidation heatmap also highlighted the cluster of short liquidations around the $1.50 area. The recent rally higher has swept this magnetic zone.

Based on the evidence at hand, a bearish trend continuation appeared likely. Sustained buying pressure and a rally past the $1.62 level is needed to signal a potential rally toward the psychological $2 resistance.

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Final Summary

• The Cosmos crypto token has rallied by just over 8% in 24 hours, with a 91.3% daily trading volume spike and an 11% Open Interest surge.
• While the short-term momentum appeared bullish, ATOM would likely struggle to clear the $1.50 supply zone.

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