Bittensor (TAO) Pulls Back to Retest After $300 High — Is $412 Still in Play?

The broader crypto market is facing notable selling pressure today, with Bitcoin dropping over 4.5% and Ethereum sliding more than 5.90% in the past 24 hours. This sharp decline has triggered over $457 million in liquidations, cooling momentum across major altcoins.

Among them, Bittensor ( $TAO ) has also seen a pullback. After a strong rally, TAO is down around 6% today, trimming its weekly gains to roughly 29%. However, this decline appears to be part of a healthy retest phase following a significant breakout.

AI Catalyst Fueled the Rally

TAO’s recent weekly surge wasn’t random. A major catalyst came from Bittensor’s ecosystem — specifically Subnet 3 (Templar) completing Covenant-72B, a 72-billion-parameter large language model trained entirely in a decentralized manner.

This milestone highlighted the real-world potential of decentralized AI infrastructure, drawing strong attention to the network. Since participation in subnets requires acquiring and staking TAO, demand for the token surged — driving the breakout.

Retesting the Descending Broadening Wedge

Looking at the daily chart, TAO had been trading inside a descending broadening wedge, a pattern often associated with bullish reversals.

Recently, TAO broke above the wedge’s descending resistance near $260, confirming a breakout that pushed the price to a local high of $300.80. However, the rally faced resistance at the 200-day moving average, combined with broader market weakness, leading to a pullback.

Now, TAO is trading around $260 and retesting the breakout zone near $256, which aligns closely with the former resistance trendline. This level is acting as a critical support zone.

This retest is important — successful breakouts often revisit their breakout levels before continuing higher. The current price action suggests bulls are attempting to defend this structure.

What’s Next for TAO?

The next move for TAO depends heavily on how it reacts at this key support zone:

Bullish Scenario: If TAO holds above the $256 breakout trendline and rebounds, followed by a reclaim of the 200-day MA and the recent high at $300.80, it could confirm renewed strength. In this case, the next upside target sits near $412, which aligns with the measured move from the wedge pattern — implying a potential 57% upside from current levels.

Bearish Scenario: If TAO fails to hold this support and drops back below the trendline, the breakout could be invalidated. This would likely push the price back inside the wedge, delaying the bullish outlook and possibly leading to further downside.

Final Outlook

TAO’s current pullback doesn’t necessarily signal weakness — instead, it reflects a textbook retest of a breakout structure. With strong fundamentals from the decentralized AI narrative and a clear technical setup, the token remains one to watch.

For now, all eyes are on the $256–$260 zone. If bulls defend it, the path toward $412 remains firmly in play. If not, the market may need more time before the next major move unfolds.

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