Amid the market downturn and Bitcoin’s uncertainty, the price of one of the well-known cryptocurrencies, Filecoin (FIL), continued to trade at relatively low levels in the second half of this month, but the decline seemed to have stopped as of last week. These purchases made by investors may indicate a recovery for FIL, although FIL might not realize it.
Current Situation of Filecoin Investors
The noticeable decline in Filecoin’s price over the past month continues to bother investors. The declines triggered $20 million in long liquidations throughout June. The market downturns also brought about price fluctuations.
These liquidations have caused investors to be concerned about their investments. The open interest rate dropped by 28% over the past 7 days. This change in sentiment specific to Filecoin highlights the high volatility that can occur in the cryptocurrency market.
Another noteworthy point for Filecoin is its high correlation with BTC. There is an almost perfect correlation of 0.90 between BTC and FIL. This suggests that possible declines in Bitcoin can also pull Filecoin down. Potential declines in BTC could drag FIL’s price down as well.
Bitcoin‘s ongoing decline for about 2 weeks suggests that the existing correlation between Filecoin and BTC could cause significant problems.
How Much Will FIL Be Worth?
Considering the possibility of a recovery in Filecoin‘s price, it faces significant resistance. If it approaches this resistance, the altcoin could trade at $4.3. If FIL can surpass the resistance level at $4.6, it could regain its former support level of $5.0.
After reaching this level, the price could rise to $5.6. This price level is an important resistance level that FIL needs to overcome.
However, if the notable $5.6 level is not surpassed, price consolidation could occur around the $4.6 level. On the other hand, if a decline occurs in the altcoin, falling to the $4.2 level could completely eliminate the upward trend and deepen the decline.
