Price forecast for Gate: GTE is preparing for a potential rebound

• Gate is advancing within a falling wedge pattern, with the bullish aiming for a breakout rally.
• Optimism remains stable among Gate derivatives traders.
• On-chain data shows a decrease in profit-taking and active addresses.

Gate (GTE) is trading above $0.80 at the time of writing this article on Friday, with the bulls trying to overcome the 3.26% loss from the previous day. The recovery of Gate hints at a potential breakout of the falling wedge pattern on the 4-hour chart amid ongoing optimism among derivative traders. However, on-chain data shows weakness as profits and network activity decline.

On-chain data reveals underlying weakness

The Realized Profit/Loss of the Network (NRPL) is used to measure the net amount of profit or loss realized by token holders after on-chain transactions. Santiment data shows that the NRPL of Gate stands at 3.48 million GTE, down from 13.98 million GTE on Thursday. This indicates a significant decrease in the amount of profits recorded by GTE holders, suggesting a decline in bullish momentum.

Moreover, the number of active addresses on Gate fell to 24,455 on Friday, down from 24,955 the day before, indicating a decrease in network activity. Gate is in a delicate position, as on-chain data points to a fading bullish momentum and network activity.

Gate is approaching a breakout of the falling wedge pattern

Gate advances more than 2% on the day, challenging an upper resistance trend line on the 4-hour chart, formed by connecting the highs of August 14 and 25. This trend line completes a falling wedge pattern with a support trend line connected by the lows of August 20 and September 1.

If Gate makes a decisive close above the 200-period Exponential Moving Average (EMA) at $0.8335, it would confirm the breakout of the falling wedge pattern. The breakout rally on Gate could target the pivot level R1 at $0.8913.

Adding to the optimism, the Open Interest (OI) of Gate remains above $1.570 billion, following the rally in mid-August. This indicates a steady optimism among derivative traders.

However, the technical indicators on the 4-hour chart show mixed signals after the chaotic decline of the last few days. The Moving Average Convergence/Divergence (MACD) is approaching its signal line for a crossover, which would indicate a bullish change, just one day after a bearish turn on Thursday.

The Relative Strength Index (RSI) reads 52 on the same chart, rising above the midpoint mark, indicating an increase in buying pressure. Still, the 50-period EMA shows a downward trend and has crossed below the 200-period EMA, signaling a Death Cross pattern.

Looking down, a reversal from the 200-period EMA could result in a new bearish cycle within the falling wedge pattern. If so, GTE could extend the drop to the lower support trendline near $0.7788.