Key Takeaways:
The price of Bittensor’s TAO token gained 10 percent in intraday trading on April 6, breaking through a significant resistance level at $300 in a move that has shifted the market’s technical structure. The token now trades near $330, establishing the former resistance as a new base of support.
"The price action shows a clean and convincing break of structure," said Jason Wu, an on-chain analyst. "Flipping a key resistance level like $300 into support is technically bullish. However, the sustainability of this rally is questionable given the signals coming from the derivatives market."
The surge on April 6 pushed the price of TAO decisively above the $300 mark, a level that had previously capped multiple rally attempts. This breakout confirms a higher-low, a classic bullish indicator. The move was not tied to any specific news catalyst but appears to be a technical breakout, attracting momentum traders.
Despite the bullish price action, data from the futures market suggests the rally may be driven by excessive leverage, creating conditions for a sharp reversal. High open interest in TAO futures contracts points to an "overheated" market, where a small downturn could trigger a cascade of long liquidations, rapidly pushing the price down. Traders are now watching to see if the price can consolidate above $300 to confirm it as a durable support level before the next leg up.
This article is for informational purposes only and does not constitute investment advice.
