Why is the price of Huobi Token up 12% today as rest of the market slumps?
Huobi Token (HT) has been up 12% in the last 24 hours and is one of the few cryptocurrencies bucking the general downtrend.
Trading at over $7, HT’s price is up over 80% since the beginning of this week, which is also its best weekly performance since February 2021.
HT’s intraday gains coincide primarily with crypto exchange Huobi Global announcing the opening of Starfish Finance (SEAN) spot trading on its platform.
Plans to “empower” HT
Additionally, HT’s impressive weekly gains were related to About Capital Management. On Oct. 8, this Hong Kong-based investment firm announced purchasing Huobi Global, one of the leading cryptocurrency exchanges by volume.
HT serves as a utility token inside the Huobi Global ecosystem. Justin Sun, the founder of the Tron blockchain project and reportedly the core backer of About Capital, said on Oct. 10 that they would empower HT to boost Huobi Global’s brand and business endeavors.
今天是我入职Huobi第二天，我代表Huobi Global顾问委员会发言，我们深知振兴Huobi的关键就是赋能HT，HT兴火币才能兴！未来将有许多大动作围绕HT展开，包括品牌升级，重磅赋能，商务合作，我们会团结一切能团结的力量，共同把@HuobiGlobal 做好！
— H.E. Justin Sun (@justinsuntron) October 10, 2022
Nevertheless, the HT price rally has exposed it to potential profit-taking scenarios, per a mix of technical indicators.
Huobi Token overbought?
On the daily chart below, HT’s relative strength index (RSI) has crossed above 70, which is considered an “overbought” signal. That typically follows with the price entering a consolidation or correction period.
Similarly, the HT price rally witnessed this week accompanies a drop in trading volumes, suggesting traders have been growing doubtful about the longevity of the uptrend. Again, it could result in a price correction in the coming days.
The third bearish signal comes from HT’s weekly chart.
Notably, HT’s price now tests a resistance confluence made up of its 50-week exponential moving average (50-week EMA; the red wave), the 0.786 Fib line near $7.30, and a horizontal level near $7.40 that has historically served as support but now acts as a price ceiling.
Related: Crypto markets to see ‘explosive volatility’ soon: Arcane Research
The event of a pullback from this resistance confluence could have HT drop toward the $3.4-$3.8 area by the end of this year, a 50% price decline.
The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.
