INJ coin is up 500% since October – Can it 2x from here in coming weeks?

Journalist

Posted: December 20, 2023

• INJ’s momentum had halted at the 127% extension in the past.
• The huge profits that holders were sitting on could cause wild price swings in coming days.

Injective [INJ] has rallied 500% and counting since the 12th of October. Technical analysis of the token showed that it was clear skies above $25, and right now $55 was a strong likelihood.

Yet, holders from lower prices would surely add to the selling pressure on INJ.

AMBCrypto’s technical analysis laid out some levels at which holders could book profits. Re-entry could wait for the trend to stall and a sizeable pullback to occur. On-chain metrics also pointed toward overbought market conditions.

If history was to repeat itself…

Source: INJ/USDT on TradingView

Based on the October rally from $7.16 to $19.14, a set of Fibonacci retracement and extension levels (yellow) were plotted. The $15 and $25 levels had served as stiff resistances back in 2021, but not so in 2023.

INJ consolidated between $15-18 for nearly a month before rallying higher once more. On their march upward, the 100% and 127% extension levels acted as resistance. It was followed by another swift push to the 200% level.

The RSI on the daily chart was at 88, deep in the overbought territory.

However, it does not dictate a pullback should occur. We can expect multiple tests of the $46.35 level over the next few days, a minor retracement toward $40, and then another push higher should the past month’s trading repeat itself.

Yet, trading is hardly ever that easy.

The MVRV ratio was above the November highs again

Source: Santiment

As the prices continued to rally higher, the age-consumed metric remained silent. This suggested that INJ tokens were not moved in large numbers, a signal that usually precedes a giant wave of selling. However, the MVRV was extremely high.

Realistic or not, here’s INJ’s market cap in BTC’s terms

Rational holders are extremely likely to sell their tokens to realize profits, which could heavily dent the bulls’ gains. The mean coin age, which trended upward from the 24th of November to the 10th of December, saw the trend halted since then.

Overall, it made sense for INJ holders to sell and wait for a range formation before accumulating once more.

Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion.