One of the leaders among DePIN project tokens, Filecoin, has been unable to break out of a downward channel for several months now. In June, FIL reached a yearly high of $11.46, and since then its value has fallen almost fourfold. In this article, we’ll figure out what is preventing the price of Filecoin from starting the long-awaited rally and what to expect from the FIL rate in the near future.
Filecoin is going through tough times
FIL currently appears undervalued, but the Sharpe ratio data suggests that this cryptocurrency is not the best choice for short-term investment. The Sharpe ratio measures the risk-adjusted return on an asset. Positive values mean that investors have a good chance of getting a higher return on their investment. Negative values indicate the opposite.
At the time of writing, Filecoin has a Sharpe ratio of -2.95, which suggests that buying the cryptocurrency at its current price may not yield good returns.
However, Filecoin’s market cap is still high. It still leads the DePIN tokens in this regard. FIL’s market cap currently exceeds $2.07 billion.
However, the token’s capitalization has decreased threefold since March. This drop is directly related to the correction that the token has experienced in recent months. If this trend continues, Filecoin risks losing its leadership to tokens of other DePIN projects, such as Render (RNDR) and The Graph (GRT).
FIL Forecast: The Fall Will Continue
At the time of writing this analysis, FIL is trading at $3.62, having shown no clear dynamics in 24 hours. However, over the past seven days, the token has fallen in price by more than 4%. According to the chart below, Filecoin has been trading in a downward channel since April. This clearly indicates a bearish trend. The channel forms two downward trend lines during the correction and consolidation phases: the upper one serves as resistance, and the lower one serves as support.
In addition, the relative strength index ( RSI ) is below the neutral 50 level. Such readings confirm that bearish momentum is currently dominant. However, the FIL price is at risk of falling even lower than the current level: if the trend direction does not change, the token may fall to the support level of $3.25. However, Filecoin may well reach the resistance level of $4.27 if it is supported by buyer activity.
