EigenCloud (EIGEN) has soared more than 20% in the past 24 hours, outperforming the broader crypto market, including Bitcoin (BTC). Daily spot volume also increased 27% to approximately $34 million.
Growing network activity, growing traders’ euphoria, and a possible technical breakout appeared to fuel the rally.
Why is EIGEN network activity increasing?
Network activity on EigenCloud has increased significantly over the past three days, with the highest activity recorded on May 21. On that day alone, over 236.75 million EIGEN were transferred via 1,020 transfers.
During the same period, holders transferred a total of 279 million EIGEN tokens. Even so, while the volume transferred gradually decreased, the number of transfers continued to increase.
The number of unique users also increased slightly to around 703. Although the increase remained modest, it nevertheless reflected an improvement in market confidence.
Why are traders suddenly bullish on EIGEN?
Derivatives traders, particularly on Binance, played a major role in EIGEN’s rally.
According to CEX data, EIGEN futures volume on Binance jumped 94%. Only stablecoins saw a larger increase at 110%. At the same time, EIGEN ranked among the market’s top daily gainers.
It is worth noting that market euphoria appears to be amplifying trading activity. The relative strength index (RSI) jumped to 84 before cooling to 73, signaling overbought conditions.
In addition to this, traders also reacted to a possible breakout on the daily chart. Speculators appeared to position themselves early in anticipation of a further rise.
Can EIGEN exit consolidation?
The technical setup suggests that a breakout could be imminent as the price trades near the neckline resistance around $0.23.
Typically, an inverted head-and-shoulders pattern signals a bullish reversal if buyers continue to add capital. This consolidation structure has persisted for almost five months since the beginning of February.
At the same time, Chaikin Money Flow (CMF) rose to 0.13, reflecting improved capital inflows. Meanwhile, the Directional Movement Index (DMI) lines continued to rise.
A breakout would still face resistance between $0.23 and $0.27. However, breaking through this range could open the door to $0.34 or even $0.45.
On the other hand, a slowdown in momentum could allow the bears to extend the broader downtrend.
If risk appetite among altcoins remains strong, EIGEN could finally emerge from its long consolidation phase. For now, broader altcoin sentiment still holds the deciding vote.
Final Summary
- EIGEN price increased by over 20%, driven by network activity, excessive euphoria and increased futures volumes.
- EIGEN is close to a reverse head and shoulders breakout, but that depends on the broader market remaining risk averse to altcoins.
