EOS entered a corrective phase on April 30 which saw its price drop above 27%. The smart contract token went from trading at a high of $ 3.1 to a low of $ 2.3.
Despite the significant bearish momentum, the data shows that large investors are accumulating EOS at each trough. If history repeats itself, it could be a sign that Ethereum's rival is ready for substantial upward movement.
Whales fill their EOS bags
Santiment, a behavioral analysis platform, popular in a recent report, it looks like something is brewing with EOS. The firm claimed that there is an inverse correlation between "investors / whale calves" and "the big ones".
"As retailers (investors) distribute EOS, whales are piling up," said Santiment.
In fact, the metrics of the chain reveal that the number of addresses with 100,000 to 1,000,000 EOS began to increase on February 9 of this year. Since then, there has been a 20% growth in the number of whales behind this cryptocurrency and it continues to evolve.
Although the reasoning behind this behavior is unknown, EOS has shown strong development activity in recent months. The development community behind this blockchain protocol continues to move forward to extend the usefulness of its token despite the uncertainty of the global financial system.
Development activity is not necessarily a good price indicator, but it does add legitimacy to those projects that are in an industry plagued by scams.
As EOS solidifies its network and the whales scramble to get a piece, its price seems to be ready to take off.
A rebound on the horizon
The Tom Demark (TD) sequential indicator is currently showing a buy signal on the 1 day EOS chart. The bullish formation took place in the form of a nine red candle. An increase in demand around current price levels could help validate this signal.
If this were to happen, the configuration of TD believes that this altcoin could be linked to a rise of one to four candles or to the start of a new upward countdown.
Adding credibility to the bullish outlook, the decline in the EOS which has been going on since the end of April has enabled it to reach the Fibonacci retracement level of 50%.
Based on Gann's 50% withdrawal theory, this level of Fibonacci presents a crucial opportunity to "buy the dive". If EOS can rebound in this area with enough buying pressure behind it, it could quickly increase and reach higher heights.
However, market players should be careful about the dangers of falling below 50% of the Fibonacci retracement level. If this support barrier fails to maintain the EOS price, it could trigger a sale that will push this cryptocurrency to the black Thursday low of $ 1.42.
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