Crypto lending platform Celsius Network has an roughly $1.2 billion hole in its stability sheet, with most liabilities owed to its customers. As well as, the agency has filed for chapter safety, so its future appears to be like bleak.

Nonetheless, Celsius Network's native utility token CEL has soared in rating by over 4,100% inside the final two months, reaching round $3.93 on Aug. 13 in comparison with its mid-June backside of $0.093.


Celsius Network Is Bankrupt,so Why Is CEL Worth Up 4,000% In Two Months?
Celsius Network Is Bankrupt,so Why Is CEL Worth Up 4,000% In Two Months?

Compared, prime cash Bitcoin (BTC) and Ether (ETH) rallied 40% and 130% in the identical interval.

Takeover rumors behind CEL explosion?

Technically, the value rally made CEL an overly valued token in early August when its relative energy index (RSI) crossed above the 70 threshold.

Takeover rumors look like behind CEL's top energy. Notably, Ripple desires to buy Celsius Network's property, in keeping with an unknown supply cited by Reuters on Aug. 10.

CEL's worth greater than two-fold after the piece of reports hit the wire.

In July, rumors additively surfaced about Goldman Sachs' aim to accumulate Celsius Network for $2 billion. CEL was fixing arms for as little as $0.39 round that point.

CEL worth quick squeeze

A military of

retail merchants

additively seems to be behind the CEL's large top push inside the final two months.

Some merchants have organized a brief squeeze to restrict CEL's draw back prospects. A brief squeeze is when an plus's worth rises instantly, forcing quick Sellers to purchase once more the plus at the next worth to shut their positions.

It's manageable to create a brief squeeze attributable CEL's decreasing current provide, primarily because of the freeze on Celsius Network's token transfers.

Apparently, FTX had about 5.1 million CEL tokens on Aug. 13, roughly 90% of all the entire circulation throughout exchanges. In the meantime, the measure of open quick positions on the alternate was round 2.66 million CEL versus the month-to-month excessive of two.96 million CEL on Aug. 11.

In different phrases, quick merchants have closed about 300,000 CEL positions in simply two days.

What's later for Celsius toke?

Brief squeezes are gruelling to maintain over a long interval, historical past exhibits.

Such prospects put CEL at dangers of dealing with excessive correction inside the coming weeks or months. As mentioned, the token is already overbought, which additive provides as much like the draw back outlook. 

Drawing a Fibonacci retracement graph from $6.5-swing excessive to $0.39-swing low churns out interim help and resistance ranges for CEL. Notably, the token now eyes a prison-breaking above its 0.618 Fib line (~$4.21), with its top goal at $5.25, up 45% from right now's worth.

Conversely, a break below the help stage on the 0.5 Fib line (~$3.48) dangers bloody CEL towards $2.75, down 25% from the present worth stage.

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