- Retail investors are growing euphoric about Filecoin after a recent announcement.
- FIL has risen nearly 70% in the past three days, reaching new yearly highs.
- Despite the upward price action, on-chain and technical metrics suggest a pullback is coming.
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Filecoin has stolen the crypto spotlight after its native token, FIL, rose to new yearly highs. Still, different metrics suggest that this cryptocurrency is poised to retrace before continuing its uptrend.
Filecoin’s Popularity Explodes After Chainlink Integration
According to Colin Evran, ecosystem lead Protocol Labs, the merger will help automate storage functions and connect FIL’s network with other smart contract blockchains.
Developers will be able to compute operations off-chain with a complete Web 3.0 infrastructure.
FIL’s price appreciated nearly 67% following the announcement, outperforming some of the top cryptocurrencies by market capitalization. It went from a low of $82.60 to reach a new yearly high of $137.80.
Alongside prices, data from Santiment reveals that the number of FIL-related mentions on different social media networks also skyrocketed. Since Mar. 24, this altcoin’s social volume surged by a whopping 2,600%.
The rising chatter around Filecoin allowed it to move to the number two spot on Santiment’s Emerging Trends list.
Filecoin’s recent popularity is not necessarily a good sign for its short-term price action.
When prices pump, and the crowd pays increased attention, a steep correction tends to follow. Every cryptocurrency that claims one of the top three positions on this list regularly falls by roughly 8% shortly after.
Therefore, increased crowd attention can be considered a leading indicator of price slumps.
A Steep Decline Before Further Gains