FET's Short-Term Outlook: Is It a Bull Trap or an Ascend?

Over the past month, investors have accumulated more than $69 million in Fetch.ai (FET), reflecting renewed bullish sentiment.
Current indicators, including the Open Interest Weighted Funding Rate and trading volume, suggest a positive short-term outlook for FET, primarily driven by long contracts.
FET has experienced a significant 11% price increase in the last 24 hours.
This upward movement follows a challenging phase, including the recent termination of a partnership with Ocean Protocol that led to a token dispute.
While the current gains for FET appear promising, their sustainability will depend on various factors.

Key Takeaways

Over the past month, investors have accumulated more than $69 million in Fetch.ai (FET), reflecting renewed bullish sentiment.
Current indicators, including the Open Interest Weighted Funding Rate and trading volume, suggest a positive short-term outlook for FET, primarily driven by long contracts.
FET has experienced a significant 11% price increase in the last 24 hours.
This upward movement follows a challenging phase, including the recent termination of a partnership with Ocean Protocol that led to a token dispute.
While the current gains for FET appear promising, their sustainability will depend on various factors.

FET Price Movement

Investor Confidence Reigns

The recent surge in FET's price signals a resurgence of investor confidence in the asset. The Community Sentiment indicator, which assesses market perception, now shows that 96% of investors are optimistic about FET's future outlook.

Analysis from AMBCrypto indicates that, although there's been a notable jump in price recently, the groundwork for this rally has been laid over the past month.

FET Spot Exchange Netflow
Source: CoinGlass

During October, investors spent approximately $69.5 million on FET purchases, consistently closing each week with net buys. This pattern of accumulation often occurs when investors believe an asset is undervalued, encouraging them to purchase at lower prices before they expect a rebound.

Short-Term Drivers

The outlook for FET in the short term is positive. AMBCrypto has analyzed derivative market sentiments to support this assessment. The Open Interest Weighted Funding Rate, which helps gauge liquidity and indicates where it is focused, hints at a bullish trend.

When this funding rate is positive, it indicates that most liquidity in the market is coming from long contracts, suggesting that these traders are covering the funding fee.

FET OI-Weighted Funding Rate
Source: CoinGlass

Additionally, the trading volume in the derivatives market reinforces the trend that most positions are from long contracts. Typically, trading in derivatives plays a critical role in determining an asset's short-term price direction, and given the current bullish sentiment, FET is likely to experience further bullish movement soon.

Liquidation Insights

The liquidation heatmap provides further insight into FET's potential trajectory. It suggests that, while FET could continue to rally, there is also the possibility of a price dip.

If positive momentum persists, FET could climb even higher.

FET Liquidation Chart
Source: CoinGlass

However, there are substantial liquidity areas below the current price that could press down on FET if the bullish momentum falters. For now, the near-term outlook for FET remains positive, but investors should stay alert for potential market volatility.