TAO Price Analysis: Bullish Momentum Remains Strong Despite Recent Decline; Gradual Market Re-Entry Hints at Potential Upswing

Although TAO has seen a 22.01% drop over the past week and a 5.24% decline on the daily chart, it has not yet fully entered a bearish trend.

Despite a 22.01% decrease over the past week and a 5.24% drop on the daily chart, TAO's performance has yet to enter a fully bearish phase. The bears have not fully gripped the market, suggesting the possibility of a rebound.

AMBCrypto’s analysis revealed that bearish sentiment is beginning to wane, and TAO might be set to resume its bullish trajectory soon.

Double pattern formation and a potential bounce for TAO

At the time of writing, TAO was trading within a bullish pattern, a phase that will end once it breaks through its upper resistance line.

Before that happens, TAO is likely to experience a slight drop to the support level at $551.00. This level is critical, as it is likely to provide the momentum needed for a bullish rebound. It also aligns with the support of the bullish symmetrical pattern in which TAO appeared to be trading.

A successful push from this support level could drive TAO to new heights, potentially hitting the peak of the pattern at $748 as the bullish momentum takes hold.

Bullish momentum remains strong for TAO

Parabolic SAR (Stop and Reverse) remained bullish throughout this period, with its dots consistently appearing below the asset’s price.

The Parabolic SAR is a technical indicator used to identify the direction of a trend and potential reversal points. It places dots above the price in a downtrend and below the price in an uptrend.

The sustained presence of dots below the price as it dropped indicated ongoing accumulation. This is expected to positively impact TAO’s price and may drive the asset higher from its press time level.

To confirm this bullish trend, the Chaikin Money Flow (CMF) revealed that buyers have had the upper hand.

The CMF line recently bounced off the zero level and moved up to 0.03, with the uptick line remaining dominant. This suggested that TAO is likely to continue its upward momentum.

Gradual re-entry into the market for TAO

However, TAO’s bullish run is not yet fully established, with market participants slowly re-entering the market. Two key metrics—Open Interest and the Funding Rate—highlighted this trend.

Open Interest, which tracks the number of unsettled derivative contracts to identify the dominant cohort in the market, rose by 0.25% – Bringing its value to $230.37 million.

This hike seemed to be in line with the rising Funding Rate, with the same at 0.0168% on the 8-hour chart.

This indicated sustained buying activity among bulls, who have been maintaining market stability—A move that could drive TAO’s price higher in the coming sessions.