The last week’s crypto market slump affected each coin, triggering massive falls. With the sluggish price actions and foggy recovery road, most cryptocurrencies still struggle to clear upside paths. The situation is the same with Filecoin’s native token FIL.
Filecoin witnessed substantial sideways moves over the past four days regardless of crypto bulls’ comeback over the weekend, which triggered significant upswings for most large-cap cryptos. Though FIL is among the most promising tokens, it appears lacking considering gains recorded by top cryptos. Nevertheless, we may need to evaluate recent market events to recognize the ‘promising’ part of FIL.
UST’s crisis revealed some risks related to crypto investments. Moreover, it further forced investors to reduce risk exposure, and crypto’s utility remains a vital determinant. The decentralized file storage mechanism by Filecoin ensures ‘actual’ services with several advantages. For instance, it provides secure storage and data immutability in a decentralized approach.
Filecoin’s model ensures real-world value while solving issues related to centralized storage. The Filecoin ecosystem uses FIL as its native coin. And that means the alt will likely flourish from long-term growth. Nevertheless, FIL’s current outlook remains highly correlated to BTC.
FIL Price Action
While publishing this post, FIL traded near $8.62, a substantial uptick from the May 12 low of $6.17. Nevertheless, the alt stayed nearly 68% down from the end-of-March peak. Also, the Filecoin token remained way far from the lifetime high of $240. That translates to a massive discount and the token due for considerable recoveries.
The Relative Strength Index shows the recent bearish sentiment in the marketplace dragged FIL into the oversold region. Also, it has struggled to escape the oversold area, and the Money Flow Index displayed inadequate inflows to back massive bullish recoveries. Moreover, the MFT showed Filecoin bears losing steam, explaining the sideways price moves over the past four days.
Also, Filecoin’s on-chain index signaled some recovery following colossal sell-offs within the past two weeks. For instance, the funding rate metric on the DYDX exchange recorded a normalizing interest within the derivatives marketplace. Whales indulged in selling amid the bearish atmosphere, but supply by whales noted a brief upswing over the previous day.