- Investigating the surge of AI coins, with FET and TAO at the forefront.
- The price trends for Fetch.AI and BitTensor appear promising.
An analysis of the crypto market sectors shows that AI, DeFi, and memecoin segments have surpassed Layer 1 and Layer 2 solutions in performance over the past month.
Driving this momentum are Fetch.AI [FET] and BitTensor [TAO], which have recorded substantial gains since August. While the general market sentiment remains volatile, traders are revisiting former narratives that might regain popularity.
Source: X
While alternative narratives may surface in the future, AI and memecoins remain the clearest investment choices if market conditions improve.
Price Trends of FET & TAO
With AI coins performing well, let’s delve into the price movements of FET and TAO pairs.
Nvidia’s robust quarterly earnings in August have enhanced confidence in AI coins, indicating a favorable future for these assets.
For Fetch.AI, the price trajectory of the FET/USDT pair suggests an upcoming increase, having recently broken above an inverted head and shoulders pattern, which is often a bullish reversal indicator.
Furthermore, the Chaikin Money Flow (CMF) is on an upward trend, indicating a rise in buying momentum within the market. If this trend persists, FET could potentially hit $2.21 by the end of the year or early next year.
Source: TradingView
Likewise, BitTensor also shows a bullish perspective. Recently, TAO encountered resistance at the $440 mark after liquidating positions above two parallel highs.
Nevertheless, the TAO/USDT pair remains optimistic, as prices are set to address the gap left by a notable wick.
The CMF for TAO is on the cusp of turning positive, signaling that capital is entering this AI asset. Additionally, the relative strength index (RSI) is currently indicating overbought conditions.
Although a high RSI can suggest a potential market correction, it often denotes strong bullish momentum, particularly for TAO.
Source: TradingView
Futures Funding Rates
Another encouraging sign is the recent positivity in futures Funding Rates for Fetch.AI, which has shifted from negative to positive.
This change suggests that more traders are opting for long positions, typically leading to price increases for FET and other AI-oriented coins.
When Funding Rates rise, it indicates that long holders are compensating short sellers to uphold their bets, reflecting heightened demand for FET and its counterparts.
Source: Coinglass
However, this situation may increase liquidation risks for long positions if the market experiences a downturn.
Comparative Analysis of Coins
FET appears to be the more attractive option when comparing investment possibilities between the two. In the last month, FET has surged by 71%, outpacing TAO’s 28% increase.
Moreover, FET has a higher market capitalization of $3.79 billion, while TAO stands at $2.46 billion. This results in a volume-to-market cap ratio of 11.65% for FET as opposed to 6.54% for TAO.
The superior volume-to-market cap ratio for FET indicates it may represent a safer investment, particularly in terms of price fluctuations.
Source: Coinpare
The AI sector, spearheaded by FET and TAO, exhibits promising potential for increased valuations.
Read Artificial Superintelligence Alliance’s [FET] Price Forecast for 2024–2025
With favorable market circumstances and encouraging price trends, both traders and investors should monitor these coins as they navigate the changing crypto landscape.
As AI coins continue to gain prominence, FET and TAO may offer worthwhile opportunities for those interested in investing in this vibrant market.
