Keys Insights
- Meta is set to utilize Arweave for storing digital collectibles on one of its social media platforms, Instagram.
- Soon after this announcement, the price of AR began a swift bullish move to the upside, bringing it to a daily high of $17.77.
- Over the last 24 hours, the price has risen by over 60%.
Arweave is a decentralized data storage network.
Like file storage systems like Filecoin and Sia, it is a web3-based software architecture that stores information and large tranches of data across a decentralized network of computers.
Meta, the web2 giant, is set to utilize Arweave for storing digital collectibles on one of its social media platforms, Instagram.
This huge development is interesting because it is a merger between one of the biggest web2 giants in the world and another relatively huge web3 utility.
Soon after this announcement, the price of AR began a swift bullish move to the upside, bringing it to a daily high of $17.77. Over the last 24 hours, the price of AR has risen by over 60%.
The $15.43 resistance zone is a highly strong one, and Arweave has been unable to break above it since early August this year.
As illustrated by the chart above, the cryptocurrency has broken through this price level several times during the year but has failed to stay long above it. This leads to the question of whether Arweave can maintain this important price level.
AR Price Action
After the bullish streak over the last 24 hours and a hit at the $17.77 zone, the cryptocurrency has reversed its trajectory and has retested this $15.77 price level.
While a breakout from such an important price level appears to have happened, the close of a daily candle above it is still required for a confirmed breakout.
Right before this move to the upside, the RSI on AR’s 4-hour chart was trending toward the oversold zone at a level of 40. However, the RSI printed a bullish crossover right after Meta’s announcement. The cryptocurrency shot up and hit extremely overbought RSI conditions around 90.8.
The conditions on Arweave’s RSI are starting to normalize but still show overbought conditions at an RSI level of 71.
From a medium-term perspective, it is easy to illustrate Arweave in a descending triangle that has remained valid since March this year, with the recent uptick representing a breakout.
If this is the case, it would mean that the cryptocurrency still has a chance to hit the $19.50 zone (provided it closes above the $15.77 zone with a daily candle).
Will Arweave Continue the Upsurge?
From a longer-term perspective, Arweave appears to have broken through a larger descending triangle long ago.
After what appears to be a breakout from the longer-term price formation formed by its $91 all-time high and its $7.5 all-time low, Arweave failed to rally to the upside as expected.
Instead of rising sharply to the next fairly-strong resistance zone around the $25 mark, Arweave started to consolidate, ranging from the $18.25 zone to the $8 support.
Arweave is now testing its local resistance around the $15.77 zone. The cryptocurrency may confirm a breakout if it closes above this price level and possibly rises to $18.25.
The RSI on its weekly chart has now risen to the neutral level, indicating that further upward price movement is possible on the crypto.
The RSI tells a different story on the daily timeframe and shows oversold conditions. This poses a real threat to the ability of Arweave to close above the $15.77 zone and severely threatens the prospect of further price movement to the upside.
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