Filecoin price has collapsed, erasing all the gains made in 2024, and making it one of the worst-performing tokens in crypto. The FIL token plunged to a low of $2.6155 on Monday, its lowest level since 2022. It has plunged by over 74% from its highest level in 2024. So, why is the Filecoin price falling, and will it bounce back?
Filecoin price forecast
The weekly chart shows that the FIL coin price has remained in a tight range in the past two years even as the network made major progress and updates. It has remained inside the key support level at $2.6155 and resistance at $11.4. In contrast, other cryptocurrencies like Bitcoin, Solana, and Mantra have all surged to a record high recently.
Filecoin price remains sharply below its all-time high of $237.67, transforming it from a top-20 coin into the 47th biggest coin in the world. It has now remained below the 50-week and 25-week moving averages, a sign that bears are in control.
The Relative Strength Index (RSI) and other oscillators have all moved downwards, a sign that the coin is losing momentum.
On the positive side, there are signs that the Filecoin price has moved into the accumulation phase of the Elliot Wave arrangement. This period is usually characterized with sideways movements, with the price remaining in a tight range.
The Filecoin may also start the first phase of the Elliot Wave pattern soon. This phase is usually a bullish one and is followed by the corrective phase two and the longest wave three performance.
Therefore, all is not lost for the Filecoin price since it has a good chance of recovering. The initial rebound may see it jump from the current $3 to the upper side of the range at $11.42. A move above that level, on the other hand, will point to more gains to $27, the highest swing in March 2022.
The alternative scenario is where there is a strong rebound now that it has dropped below the lower side of the horizontal channel.
Why is the FIL token crashing?
There are a few reasons why the Filecoin price has crashed. First, the coin has plunged because of the ongoing crash in the crypto industry. Bitcoin has fallen below $93,000, while Ether moved below $2,500 for the first time in weeks. Other top laggards in the crypto industry are Bittensor, Celestia, Gala, Cardano, Injective, and Worldcoin, which fell by over 35% in the last 24 hours.
Filecoin price has also crashed as investors shifted from utility coins to meme coins. Recent data showed that meme coins were some of the best performers in the crypto industry. Some of the top meme coins that minted millionaires were the likes of Official Trump, Melania, and Vine.
Further, there are signs that the Filecoin ecosystem is not doing well. For example, the Filecoin FVM network has a total value locked (TVL) of over $47.6 million, down from $120 million in December last year. It has been overtaken by other newer and highly popular cryptocurrencies like Aptos, Sui, and Hyperliquid.
There are also concerns that the Filecoin network is not doing all, with most users continunuing to use centralized storage solutions like Amazon AWS and Google Cloud. It has also not been adopted by most AI models as most analysts expected.
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