The Cosmos (ATOM) price is up just over 10% over the past month. The so-called stealth rally in crypto is building, with Cosmos just one example of this. However, we feel that for longer-term growth and income yield from staking, Cosmos could come into its own later this year. Here’s why we think a breakout could be coming.
For those not aware, Cosmos (another term for the universe) essentially exists to create a network of existing crypto networks. It helps to foster an ecosystem within which networks can share information, be it regarding blockchain, data, tokens or other things.
The actual cryptocurrency tied to this is Atom, the native token of the Cosmos hub. The important point here to note is that Atom can be staked, and is currently being paid out at a rate of 5% on Coinbase.
Going forward, we feel that Cosmos will act as an overarching ecosystem or blockchain father to the rest of the community. If interest in crypto gets another surge (which recent volumes suggest is likely), then Cosmos will stand to gain.
Added to this, investors are trying to find a home for cash that can be used to offset the high inflation we are seeing around the world. With major central banks still having rates below 1%, a 5% staking yield is very attractive. This could also help the Cosmos (ATOM) price to rally higher.
The current Cosmos (ATOM) price sits just above $30. A rising wedge is being formed from the past year, with the floor from summer of last year at $20, rising to $22-23 in December and $24-25 in February. This should now act as a good support on the downside, which we estimate to be at $27-28.
On the high side, we are looking for a break of $34 to take out the March tops. From here, it should be noted that the coin has struggled to break the $40-45 resistance region on several occasions over the past year.
Yet from current levels, we feel that there is enough gains to be excited about even to take it back to $40-45. From here, it may be wise to trim profits.