Bittensor breaks through two-month resistance, and a greater test approaches

Key Points

The top priority of the TAO is to keep the 50-day moving average below the price.

Reestablishing a firm footing at $206 will open the way towards $225.

Corporate testing provides the strongest fundamental support for the rebound.

Gray scale has increased attention at the institutional level, but has not demonstrated continued need.

Test the 50-day moving average

TAO has been below the 50-day moving average since mid-June until it finally closed back above the average yesterday. The moving average is currently around $203 and is being tested as a potential support level. The 0.786 Fibonacci retracement level immediately above it (close to $206) remains direct resistance.

TAO/USD daily price chart, showing key Fibonacci levels and market indicators.

TAO broke through this Fibonacci level intraday, but has fallen below it as of writing. This puts prices between two closely spaced levels with different effects: the 50-day moving average must remain below the price, and the $206 still needs to be recovered. If the price closes at $206 and can hold this area during the correction, the range of about $203 to $206 will be more convincing as support. The next important Fibonacci level is near the 0.618 retracement level, about $225. After breaking through this position, TAO will face another difficult area, approximately US$232 to US$233, where the 100-day moving average (approximately US$232) and the 200-day moving average (approximately US$233) converge intensively. The daily RSI has also risen to around 57, above neutral levels, but is still far from overbought territory.

Corporate pilot projects add fundamental support

Recent developments within the Bittensor ecosystem provide a fundamental perspective beyond the chart for the rebound. The OpenTensor Foundation said five enterprise platforms with a total value of more than $22 billion are testing technology developed by Bittensor's RedTeam subnet. According to OpenTensor, these platforms collectively cover more than 900 million accounts and process more than 1 billion transactions per week. What matters is not the size of these companies, but the pilot projects show that companies are evaluating technologies developed within the Bittensor ecosystem based on real-world workloads. This makes more sense for the Internet than short-term social attention, although the evidence is still in its infancy. Testing does not equal production deployment, nor does it automatically create persistent requirements for TAO. This progress will become even more important if these pilot projects advance into production and use and generate measurable economic activity within the Bittensor ecosystem. For now, these pilot projects reinforce the argument that the Bittensor subnet model is attracting attention outside the crypto-native trading circle.

Institutional footprint in gray scale

TAO remains a major component of the grayscale decentralized AI portfolio. According to Gray's latest multi-asset fund rebalancing data, as of August 3, TAO accounted for 29.15% of Gray's decentralized AI funds, becoming the fund-'s second largest position. The rebalancing involves reducing NEAR positions in the fund and reallocating the proceeds to existing constituent assets, including TAO. This strengthens TAO's position as one of Gray's main assets providing decentralized AI exposure. But this does not prove that Gray's buying triggered the recent rally. The price impact cannot be reliably determined without comparing the size of these purchases to TAO's overall transaction volume. The more important conclusion is the level of attention at the institutional level. TAO still has a significant weight in a product built specifically around cryptocurrency exposure to artificial intelligence, and even if the rebalancing itself is a one-time event, it can support a broader investment narrative.

Downside risk below US$203

The starting point for downside risk is near the 50-day moving average (approximately US$203). After TAO has been below this moving average for nearly two months, if the daily line closes below the moving average again, the strength of this breakthrough will be weakened. The first area to watch will be around $195, a position where prices have consolidated repeatedly before the latest rise. After falling below $195, the next important area is between about $183 and $187, where selling stalled during both the June decline and the late July sell-off. The Fibonacci structure itself is anchored around $183. A break below this zone would send the TAO below its lowest correction since June.