Bittensor (TAO) Technical Outlook: Can Bulls Trigger a Relief Rally Toward $238?

Bittensor (TAO) is consolidating in a neutral to bullish setup after a long period of volatility in the crypto sector. However, the current price action suggests that the bearish pressure is easing and a strong reversal may occur soon.

However, the crypto analyst, Crypto Pulse, highlighted that TAO is nearing a critical technical area as the price movement unfolds in a possible expanding broadening wedge formation. The token is strategically moving lower towards the vicinity of the $200 area, a zone that corresponds with an area of previous demand and a structural support level.

Source: Crypto Pulse

If the buying forces are able to protect the $200 levels, TAO may form a temporary relief rally to reach the top edge of the broadening channel. The breakout attempt may give the price an opportunity to test the $225 levels. But if not, then the price action may continue to form more fluctuations.

Also Read: Virtune Launches Bittensor TAO ETP in Nasdaq Stockholm

TAO Price Hits Range Low as Bulls Eye $38 Bounce

Moreover, another crypto analyst, Crypto Tony, revealed that TAO is currently at the lower boundary of its trading range, putting the price at a technically significant support area. There appears to be easing in the selling pressure, and traders are focusing on buying interest. Being a demand zone, the current level is significant for traders in determining the short-term trading direction.

Source: Crypto Tony

Being able to sustain its level in the lower region could enable TAO to establish a relief bounce, with analysts expecting it to rise towards the $38 region. The relief bounce could be fueled by dip buyers and short covering. Breaching the level will raise possibilities of further falls, thus lowering market sentiments in the future.

Technical Outlook Hints at a Neutral to Bullish Setup

Technically, TAO has been trending downwards from the 260s before stabilizing around the 215-225 mark. The current price is around the Bollinger Band midpoint after the rebound from the lower band. The tightening bands indicate that the volatility level is compressing. The level of resistance is standing at 226-227, with the support around 213-215.

Source: TradingView

The momentum indicators display a neutral to slightly positive outlook. The fact that the RSI is at 51, above the middle line, indicates that the momentum is improving without the possibility of an overbought environment. The MACD histogram is still positive, with the lines converging in an upward manner, implying a bounce. A breakout above 226 is required to maintain an upside trend, while a breach of 215 will cancel the positive outlook.

Also Read: Bittensor (TAO) Price Forecast: Weekly Support Zone Could Trigger $450 Rally