Cosmos price staged a strong recovery on Saturday as investors buy the dip in the coin. ATOM, its native token, is trading at $8.10, which is about 17% above the lowest level on Thursday this week. Unlike other popular cryptocurrencies like Bitcoin and Ethereum, Cosmos has rallied by over 45% from its lowest point in June, bringing its total market cap to over $2.3 billion.
Why is ATOM price rallying?
Cosmos is a leading blockchain project that uses the Inter-Blockchain Communication (IBC) technology to help hundreds of cryptocurrencies communicate with each other. It is now used by popular cryptocurrencies like OKX, BNB, and MATIC.
Cosmos also owns an SDK, which is a platform where people can build decentralized applications. Some of the most popular apps created in Cosmos are ThorChain and Osmosis.
Cosmos made headlines recently when Terra and its ecosystem crashed. This was a notable development since Terra used Cosmos’ technology to build its products. Its collapse is one of the few reasons why the ATOM price has crashed by more than 77% from its highest level this year.
Another reason is that Cosmos’s Gravity DEX recently moved from the Cosmos ecosystem to Crescent DEX. Gravity is a leading DeFi platform that works across multiple chains. At the same time, Emeris announced that it was pausing its development due to the rising volatility.
Meanwhile, Cosmos price has struggled because of the fear of rising interest rates and the fear that DeFi is dead. The Fed is expected to hike interest rates by 75 basis points in July after hiking by another 0.75% in the previous month.
It is unclear why ATOM has bounced back during the weekend since there has been no major news about the network. A likely reason is that the network was recently selected by dYdX, a leading player in the DeFi industry. The exchange will launch its chain on Cosmos.
Cosmos price prediction
The daily chart shows that the ATOM price has been in a bullish trend after it bottomed at $5.56 in June. Now, the coin is being supported by the 25-day and 50-day moving averages. Indeed, the two have formed a bullish crossover pattern.
Oscillators like the Relative Strength Index (RSI) and the MACD have continued rising. Therefore, the outlook for the Cosmos price is bullish, with the next key resistance level being at $8.75, which was the highest point this week.