• Bittensor extends its sell-off to $300, trading 20% below its March high of $378.
• Retail interest in TAO steadies with futures Open Interest rising to $416 million on Tuesday.
• Momentum indicators, including the MACD and the RSI, edge lower, limiting Bittensor’s recovery potential.

Bittensor (TAO) is grading lower toward the pivotal $300 level at the time of writing on Tuesday. The Artificial Intelligence (AI) token came under renewed selling pressure last Wednesday, with the price rejected from its monthly high at $378.

As market participants weigh the broader risk environment amid the war in the Middle East and broader macroeconomic uncertainty, TAO’s near-term trajectory could remain hinged on its ability to hold key support levels and attract fresh investor interest.

Bittensor steadies at support as derivatives recover

The Bittensor derivatives market has stabilized, with Open Interest (OI), reflecting the notional value of outstanding futures and options contracts, rising to $416 million on Tuesday, from $402 million the previous day.

CoinGlass data shows that OI surged to $555 million last Wednesday, aligning with the TAO’s March peak of $378. Therefore, a steady increase would reinforce investor confidence in the AI crypto token and increase the chances of a sustained recovery.

Meanwhile, traders are increasingly piling into long positions, with TAO’s futures OI weighted funding rate holding at 0.0074% in the positive territory. Traders lean into risk when sentiment surrounding the underlying asset improves. Despite the pullback from the $378 high to $300 support, interest in Bittensor appears intact, suggesting a potential recovery in the short- to medium-term.

Technical outlook: Bittensor holds key support

Bittensor is trading under pressure as sellers regain control following the rejection from the highs of $378. Its near-term bias remains neutral-to-bearish after the token broke above the long-running descending resistance trend line around $274, shifting that line into a backdrop of former supply turned into support.

The price holds above the clustered 50-day, 100-day and 200-day Exponential Moving Averages (EMAs) between roughly $250 and $274, indicating the broader trend has rotated upward despite the recent pullback from its March peak.

Still, the Moving Average Convergence Divergence (MACD) indicator has slipped below its signal line as red histogram bars expand on the daily chart, showing fading upside momentum rather than outright trend reversal, while the Relative Strength Index (RSI) at 60 eases from overbought territory yet remains above 50, consistent with a corrective pause within an emerging uptrend.

Bittensor's initial support is seen at $300, followed by the 200-day EMA at $274 and the demand zone around $250, where a deeper retracement would be expected to attract dip buyers if the bullish bias is to remain intact.

On the upside, immediate resistance lies at the recent high near $316 – a break here would open the way toward $337 and then the $378 swing high. A daily close above $378 would confirm a continuation of the bullish leg, while a sustained drop back below $274 would undermine the current upward bias.

(The technical analysis of this story was written with the help of an AI tool.)