KAT surged over 40% in one day, but uncertainty looms over its potential for sustained recovery.
- KAT has seen a significant push, surging over 40% in one day. However, the odds of a sustained recovery remain uncertain.
Karat [KAT] has shown significant market activity, with a trading volume of $52,172.73 in the last 24 hours, marking a remarkable 345% increase from the previous day.
Currently, KAT’s price is 20.14% above its all-time low, reflecting a more than 40% rise in the last 24 hours, trading at $0.000549 at press time. This surge in trading volume and price suggests growing interest and activity in the market.
Indicators suggest KAT might be undervalued
For context, KAT tokens are available for trading on both decentralized and centralized exchanges. The most popular exchange to buy and trade Karat is SyncSwap, where the most active trading pair KAT/USDC has a trading volume of $225.73 in the last 24 hours.
Despite initial optimism, KAT has faced a dramatic pullback, leading to over a month of consolidation. On the daily price chart, KAT’s next challenge is to overcome resistance at $0.001 before aiming for a previous rejection at $0.002.
Source : TradingView
While the surge in trading volume boosts confidence in KAT’s future value, key indicators suggest it might be undervalued, as indicated by a declining RSI.
Put simply, an RSI below 40 typically indicates the token is oversold, signaling that investors are not recognizing potential future gains and are exiting amid market volatility.
Similarly, a sharp drop in CMF indicates a lack of capital entering the market. However, optimism persists with a spike in OBV, suggesting that daily active trading is increasing, potentially fueled by Bitcoin’s minor surge.
For a price recovery, AMBCrypto identified conditions that must align with the rising trade volume. If these conditions signal bullish trends, leading to spikes in RSI and CMF, a correction may be on the horizon.
A change in sentiment is needed
If bulls aim to reestablish KAT near its original ATH, changes in several quarters are essential.
First, the 180-day chart below shows a spike in volume that coincides with Bitcoin’s bullish moves during the early August cycle. However, since then, total volume on the Karat network has dramatically fallen from $128K to less than $50K at present.
Source : Santiment
Additionally, a spike in volume aligned with a positive sentiment shift, allowing KAT to test the $0.002 resistance. However, despite a fourfold increase in volume, sentiment has now shifted into negative territory.
The lack of positive sentiment may undermine recent bullish efforts to counter the pullback that surged the token by 40%.If this sentiment remains unchanged, it could jeopardize any potential price spike.
Overall, a definitive price recovery isn’t likely. If bulls show a bit more aggression, they could trigger a slight surge. However, a climb to the $0.002 resistance remains out of reach for now.
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