The blockchain platform for gaming
Flow is a platform designed for blockchain-based gaming, enabling developers to create and trade unique digital assets known as non-fungible tokens (NFTs). It was developed by Dapper Labs, the same company behind CryptoKitties, a viral trading game launched in 2017.
With Flow, the CryptoKitties team overcame several technical obstacles, which helped them attract a broader base of mainstream users. While most blockchains consist of nodes that store the entire transaction history and validate all actions, Flow operates differently.
Flow’s approach involves subdividing its network to distribute the workload across nodes, with each one validating only a specific subset of transactions. This multi-node design enables a more scalable and efficient system. Additionally, Flow blockchain smart contracts are written in Cadence, its native programming language, and the Flow team offers resources for developers new to blockchain applications to learn Cadence.
The FLOW cryptocurrency is essential for the operation of the Flow blockchain, serving as the primary currency for payments, transactions, and rewards. To become a node operator, users must own and stake FLOW tokens, which also grants them governance rights within the platform.
Current performance of Flow
The price of FLOW is currently over 90% lower than its January 2022 highs, and the risk of further decline remains. The FTX collapse has cast doubt on the crypto market, while hawkish signals from central banks have added pressure on the market.
Last Thursday, the European Central Bank raised interest rates by 50 basis points, and the U.K. Central Bank followed suit with a similar hike to its highest level since 2008. The U.S. Federal Reserve also increased interest rates by 50 basis points and indicated more hikes in 2023 to combat inflation. The federal funds rate is now between 4.25% and 4.5% (the highest since 2007), leaving investors concerned about the potential economic consequences of these increases.
“Financial markets remain under pressure as concerns grow that the Fed’s inflation-fighting efforts could push the economy into a recession. It seems the market is beginning to understand that bad news means bad news, and that’s what is happening now.”
– Dave Wagner, Equity Analyst & Portfolio Manager, Aptus Capital Advisors
Investors continue to avoid riskier assets, and FLOW could experience further price drops in the coming weeks. If Bitcoin fails to maintain a $16,000 floor, it could trigger more significant sell-offs in the crypto market.
Technical analysis for Flow (FLOW)
Flow (FLOW) has dropped from $2.05 to $0.71 since November 03, 2022, and currently sits at $0.76. FLOW could struggle to stay above the $0.70 mark in the short term, with a potential drop to $0.60 if this support level is breached.
The trendline shown on the chart below indicates that as long as FLOW’s price remains below this line, we cannot confirm a trend reversal. Therefore, the current price zone is still in the “SELL” zone.
Key support & resistance levels for FLOW
On the chart from June 2022, key support and resistance levels are highlighted to help traders predict price movements. FLOW remains under pressure, but if the price rises above the $1 resistance, the next target could be $1.30. The current support level stands at $0.70; if this level breaks, a “SELL” signal will appear, and the next target could be around $0.60. A drop below $0.50 could bring the price closer to $0.40.
Factors favoring the rise of Flow (FLOW) price
Although the upside potential for FLOW is limited, if the price breaks above the $1 resistance, the next potential target could be $1.30. Positive news about the Federal Reserve easing its hawkish stance could also support FLOW’s price, especially if the Fed signals slower rate hikes at its next meeting.
Factors indicating further downfall for Flow (FLOW)
Since November 03, Flow (FLOW) has dropped by more than 60%, and market participants should prepare for the possibility of additional declines.
The current support for FLOW is at $0.70; if this breaks, the next targets could be $0.60 or lower. Additionally, the price of FLOW is strongly correlated with Bitcoin, and if Bitcoin falls below $16,000, it could have a negative impact on FLOW’s price.
It is important to note that this year, the correlation between Bitcoin and the stock market has exceeded 90%. Therefore, Bitcoin’s price could continue to mirror stock market movements in the upcoming months.
Nêrînên ji analîst û pisporan
The fundamentals of Flow (FLOW) are tightly linked to the broader cryptocurrency market, which makes it vulnerable to further downward trends. Many analysts believe that FLOW could decline further before reaching the bottom of the current bear market. Mike Novogratz, Head of Galaxy Digital and former Goldman Sachs fund manager, stated that cryptocurrencies are unlikely to see a significant rebound until the Federal Reserve shifts from its hawkish policy to monetary easing.
Many analysts anticipate that Bitcoin’s price could fall below $15,000 in the near future, and if this occurs, FLOW may also see lower levels.
Ava dikan: Crypto investments are highly volatile and may not be suitable for everyone. Never invest money you cannot afford to lose. The content on this site is intended for educational purposes only and should not be construed as financial or investment advice.
