Bittensor (TAO) Market Outlook: Uncertain Short-Term Direction, But Bullish Long-Term

Bittensor (TAO) has been one of the best-performing AI (Artificial Intelligence) tokens this cycle after surging 180% during Q1 2024.

Bittensor Protocol's native token, TAO, has registered a 10% drop from Friday's price, leaving some investors speculating on the AI token's short-term performance.

According to renowned crypto analyst Altcoin Sherpa, the token might still experience a 25%-30% drop, considering the bearish market structure. This could lead the price below the $200 support level once again "pretty soon."

"I wonder if AI tokens like TAO will still massively outperform the rest of the market like they did in early 2024," added Sherpa.

However, another market watcher, Gonzo, believes that the token is "set to lead the AI wave" in the coming months. TAO might need to move sideways for a while and "hope that BTC doesn't dump" to start a new uptrend.

Gonzo also suggests that Grayscale "might dump it hard to get in cheap" but "will pump it to make money" after launching its Bittensor fund.

As reported by NewsBTC, Grayscale Investments announced the offering of its new crypto fund, the Grayscale Bittensor Trust, last week.

Crypto trader Pidgeon also shared his analysis on TAO's long-term performance, highlighting an unclear path in the shorter timeframes.

According to the post, the chart displays a "big head and shoulders" pattern in the weekly timeframes. To the analyst, this pattern, which suggests a trend reversal, "remains completely irrelevant as long as Bittensor holds the $200 support area."

He adds that the chances of TAO holding this level significantly increase after "Monday's major fakeout and liquidity sweep."

Moreover, Pidgeon points out that the token is moving within a clear range between the $210 and $360 levels in the daily timeframe, where the token has previously consolidated.

"There won't be a major direction until either side breaks," he said.

To break from the downtrend, TAO must reclaim the $310 level before retesting the $360 mark. If it breaks above the $360 trendline, the token's price could retest the $480 and $570 resistance levels before trying for a new ATH.

If it fails to hold above the $200 support zone, it might "revisit the wick lows down around $160" and even go as low as $90. Nonetheless, he identified a lower high structure "that it has been stuck in for months" and that "tends to break to the upside."

"Ultimately I'm leaning bullish med-long term, but it will depend on which side of the range it breaks," he concluded.

TAO's price has dropped by 4% in the last 24 hours. The AI token trades at $277 as of the last check, showing a 75% gain from its August lows.

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