FET Price Rallies 25%, But Uptrend Faces Strong Bearish Pattern

Artificial Superintelligence Alliance ($FET) has displayed a recovering price pattern on its chart, posting a 25% gain this week. While the uptick might seem encouraging, underlying bearish cues suggest the cryptocurrency could be preparing for a significant drawdown.

To further concern the investors is the formation of a key bearish pattern that could determine losses for $FET holders.

$FET Investors Face Selling

The Price DAA Divergence is currently flashing a sell signal for $FET, raising concerns about sustainability. Rising prices are diverging from the network’s declining activity, creating a dissonance that often leads to corrections. Historically, similar scenarios have prompted price drops, potentially redirecting investor optimism.

The divergence suggests that despite the recent gains, $FET’s bullish sentiment may be short-lived. To align the price with on-chain activity, a correction seems imminent. This pattern reflects a broader trend of markets recalibrating when prices outpace organic network growth.

$FET Price DAA Divergence. Source: Santiment

$FET’s macro momentum, analyzed through the Average Directional Index (ADX), offers a nuanced picture. The ADX currently lies below the neutral threshold, signaling the prior downtrend has weakened, possibly ending. This development suggests $FET may transition into a more stable phase.

Interestingly, if the ADX begins to rise again, it would indicate a strengthening uptrend. This dynamic highlights the importance of sustained momentum in pushing $FET toward its next resistance levels, offering hope to investors anticipating further growth.

$FET ADX. Source: TradingView

$FET Price Prediction: Escaping The Pattern

$FET’s price is teetering on the edge of forming a bearish head-and-shoulders pattern, a warning sign for potential losses. A drop below the $1.19 support level would confirm the pattern, potentially triggering a significant decline.

Despite these bearish signals, mixed factors suggest $FET might still hold above $1.40, even if it struggles to breach $1.71. This support level could act as a buffer against further losses, providing some relief to investors.

$FET Price Analysis. Source: TradingView

Should $FET flip the $1.71 resistance into a support level, it could rally to $1.95 and even $2.00. This move would invalidate the bearish outlook and strengthen the uptrend, offering an optimistic scenario for the altcoin’s future.