Covalent (CQT) has broken out above a long-term bullish pattern and may continue to rise in the near future.
On February 24, Web3 data provider Covalent announced that they are collaborating with Coinbase to support Base’s testnet, a new Ethereum Layer-2 (L2) created by Coinbase.
Bullish pattern
Covalent (CQT) has been trading inside an ascending triangle since reaching an all-time low of $0.04 in August 2022. This is a bullish pattern that often leads to a breakout in most cases.
Indeed, CQT price broke out of the triangle with a large bullish candle at the end of January, marking the end of the downtrend.
The CQT price is currently confirming the upper trendline of the triangle as support. If successful, it could rise to the next long-term resistance level at $0.42, marking an almost 200% increase from the current price.
The RSI indicator supports the possibility of further upside as it moves along the ascending support line and stays above 50.
Short-term Outlook
After reaching a local high of $0.24, CQT moved inside a symmetrical triangle. This is a neutral pattern but created after an upward move, so the likelihood of a breakout is higher.
In line with the long-term trend, the price also broke above this triangle on February 23 and confirmed it as support afterwards.
Therefore, the price is likely to retest the $0.24 high in the short term.
Conclusion
The most probable outlook suggests that CQT will continue to rise in the near future. The nearest target is $0.24 and higher towards $0.42.
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