Bittensor’s native token TAO has caught the attention of crypto traders after posting an impressive 10% surge within a 24-hour period. As broader market activity remains relatively muted, TAO’s strong performance has positioned it as one of the standout assets in the current cycle, with several indicators suggesting that its upward momentum could continue in the near term.

TAO Outperforms Bitcoin and Ethereum

While major cryptocurrencies like Bitcoin and Ethereum experienced relatively flat or negative price action—BTC edged up only 0.13% while ETH slipped by 1.3%—TAO outpaced them both with a robust double-digit gain. This breakout hints at growing investor interest in altcoins with specific utility, particularly those involved in decentralized artificial intelligence infrastructure like Bittensor.

TAO powers Bittensor’s decentralized machine learning network, allowing users to contribute computational power and AI models in exchange for token rewards. As AI-related crypto projects continue to gain traction, TAO has carved a niche among investors seeking exposure to the intersection of blockchain and artificial intelligence.

Key Technical Indicators Flash Bullish

One of the most compelling technical signals supporting TAO’s recent surge is its breakout above the 20-day Exponential Moving Average (EMA). The 20-day EMA is widely used to gauge short-term price trends, and TAO’s move above this threshold indicates a shift in market sentiment toward a more bullish outlook.

This crossover often serves as an early signal that buying pressure is building. For TAO, this technical milestone has not only acted as a bullish indicator but has also established a new support level near $237.30. As long as the token trades above this zone, analysts expect further upward price action.

Adding to the optimism is the token’s Relative Strength Index (RSI), which currently sits at 54.86. The RSI measures the magnitude of recent price changes to assess whether an asset is overbought or oversold. Values between 50 and 70 suggest steady demand without entering overheated territory. With TAO comfortably in this range, there’s room for additional gains before hitting critical resistance levels.

$279 in Sight, With Potential to Reach Higher

At the time of writing, TAO is trading around $255.20. The token is now approaching a key resistance level at $279.70, which analysts consider a crucial test for the asset’s ongoing rally. A successful breakout above this level could open the door to a much larger move, with a potential upside target of $366.10 based on previous price structures and market momentum.

The bullish scenario is underpinned by strong investor sentiment and favorable technical trends. Should TAO manage to clear the $279.70 resistance, it would not only confirm the current rally but potentially establish a new leg up in the medium-term trend.

Downside Risk If Momentum Fades

Despite the encouraging outlook, traders remain cautious about potential volatility. If profit-taking intensifies or broader market sentiment turns negative, TAO’s recent gains could be at risk. A drop below the 20-day EMA support at $237.30 would invalidate the current bullish setup and might lead to a deeper correction.

In such a case, the next major support level lies near $163.70—a zone that would likely attract renewed interest from long-term holders but represent a significant decline from current prices.

Market Watchers Keep Eyes on Altcoins with Utility

TAO’s breakout is part of a broader trend where niche altcoins with real-world utility or strong narratives, such as AI or DePIN (Decentralized Physical Infrastructure Networks), are gaining traction. As more investors look beyond traditional Layer-1 tokens and cryptocurrency coins, projects like Bittensor are emerging as serious contenders in the altcoin space.

For now, TAO appears to be riding a wave of optimism. If the bullish momentum continues and macro market conditions remain supportive, TAO may not only test but surpass the $270 threshold in the coming days.