TAO is currently active around $225.4, with short-term bullish signals gradually accumulating.

**From a technical perspective, these key levels are important**

The price has just broken above the upper bands of the 15-minute and 1-hour Bollinger Bands (at $224.4 and $224.6 respectively). The MACD is expanding, RSI values have reached 73.8/64.7, indicating strong short-term momentum. The 4-hour chart has just formed a MACD golden cross, suggesting a medium-term bullish structure is forming. On the futures side, open interest remains at $183 million and continues to rise, with a 0.5% increase over 24 hours and a 1.7% increase over 4 hours, as new funds flow in continuously, confirming the authenticity of this trend.

**There are two important catalysts in the fundamentals**

Grayscale submitted an S-1 application on December 30th, promoting the launch of the US’s first Bittensor spot ETP, an effect similar to the Bitcoin ETF surge back in the day. Another is the halving event that just completed from December 14-16, where daily issuance was halved from 7,200 to 3,600 tokens, beginning to ferment the narrative of tightening supply. Institutions have accumulated over 100,000 TAO, and community sentiment remains bullish.

**On the liquidation side, attention is needed**

There are $2.4 million worth of short liquidation orders stacked in the $230-232 range. Once the price breaks above $229, it is very likely to trigger a cascade of liquidations, further pushing the price higher.

**Trading logic**

Build positions in two batches around $223-225 (initially 50%), and add if the price retraces to $222-223 (30% position). Set a strict stop-loss at $220, which has multiple support levels. Take profit on 50% of the position at $229 and move the stop-loss to the cost basis, then close the remaining 40% at $232. If the 1-hour RSI exceeds 80, immediately halve the position and consider exiting when open interest shifts from increasing to decreasing.

**Risks should not be ignored**

On the daily chart, the trend is still downward (price below EMA20 at $237 and EMA50 at $274). The current rebound may just be a technical correction. If the resistance at $229 cannot be broken, a pullback to the bull liquidation zone at $217-212 is likely. Additionally, funding rates remain positive, indicating that longs are quite crowded, and excessive leverage poses a significant risk of a squeeze.