Key Takeaways
What technical pattern suggests that H is ready for a reversal?
The recent 41% price drop mimics a previous fractal pattern that led to a 292% surge.
What derivative data supports the bullish outlook despite the price decline?
The OI-Weighted Funding Rate is positive, showing derivatives traders are predominantly betting on the upside.
Humanity Protocol [H] has seen investor sell-offs push the asset down by over 10% in the last day as sentiment weakens significantly.
While the threat persists, there remains a strong potential for the asset to make a major upward swing in the coming days.
An H fractal pattern
Technical analysis of the chart suggests that the recent price drop from its all-time high of $0.40 to $0.23—a 41% decline beginning on the 24th of October—mimics the mid-October decline.
Between the 14th to the 18th of October, the asset dropped 49.8%, falling from $0.20 to $0.10. However, following this decline, H saw a major bounce back.
Source: TradingView
The rebound led to its all-time high of $0.40—a 292% surge from its previous low—indicating a strong presence of bullish momentum.
This fractal pattern appears to be building again, implying that H could make another upward run in the days ahead.
Indicators suggest a rally
The Bollinger Band, an indicator that tracks areas of overvaluation and undervaluation to determine reversal points and market trends, suggests that a rally is near.
The BB shows the asset has now traded into the middle band, which in this scenario could serve as a catalyst for an upward rebound, as it has historically done.
Source: TradingView
This aligns with the Parabolic Stop and Reverse (SAR) indicator forming dots below the price—an indication that a buildup rally is likely to follow.
The Money Flow Index (MFI) has also maintained its bullish region between levels 50 and 80, with a current reading of 57.20. This implies that more liquidity is circulating in the market, adding to the bullish tendency.
More signs of a rally
The OI-Weighted Funding Rate data adds to the bullish outlook.
More often than not, the derivatives market aligns with an asset’s decline. Yet, this time, it’s a different case.
While H declined on the chart, funding in the derivatives market remains predominantly under the control of buyers.
Source: CoinGlass
The OI-Weighted Funding Rate confirms this with a reading of 0.0067%, implying that liquidity from derivatives is still betting on the upside in the market.
