ATOM Price Plunges as Short Squeeze Fades

The price of ATOM surged by 14.67% to $1.89 in a single session, but this move is likely a short squeeze rather than an organic breakout.

According to Terrill Dicki, the RSI and Stochastic indicators are overbought, with readings of 77.67 and 99.56 respectively, indicating that a reversion is more likely than a continuation.

The derivatives market shows that open interest dropped by 17.92% over the past 24 hours while price was rising, which is a classic signature of a short squeeze.

Traders are advised to fade the squeeze and look for a short entry on a rejection candle at or below $1.98, with a target of reversion to the $1.73 pivot first, then $1.56 if the unwind is complete.