Filecoin’s Long-term Bearish Trend: Will 2023 be Different?
Filecoin is down by 2 percent in today’s trading session, resuming a bearish trend that has seen its value dropping by 15 percent in the past month. The bearish trend also continues a long-term bearish trend which saw its value dropping by over 90 percent in 2022. Therefore, most Filecoin investors are concerned about the crypto’s prospects of recovery in 2023.
Will Filecoin Recover in 2023?
There are several factors that investors of Filecoin can consider when evaluating the prospects of Filecoin’s recovery. One of these factors is the technology and the utility of the project. Filecoin, a decentralized storage network that allows users to rent out unused storage space on their devices in exchange for the token Filecoin, may see growth as demand for computational growth and storage continues to grow in 2023.
Another positive factor is its large community of miners who use their storage space to store data and are rewarded with Filecoin. However, despite these positive factors, it is unlikely that they will be enough to stop the current long-term bearish trend from continuing. As seen in 2022, these positive factors were present when the its price dropped by more than 90 percent.
Another challenge for Filecoin in 2023 will be trading against the general industry-wide bear market. Due to its high correlation with the industry, it is unlikely that we will see its value rise while the whole industry is in a bear market.
Therefore, my Filecoin price forecast for the next few weeks and possibly months expects the current bearish trend to continue. There is a high likelihood that we might see its value dropping below the $3 price level again. A drop below the $2.5 price level is also possible within the next few trading sessions, despite Filecoin’s aggressive surge of 9 percent yesterday. However, if its price hits $4.5, my bearish analysis will be invalidated.