A Double Top Pattern Puts IMX At Risk Of 43% Losses

The crypto market started the trading day on Thursday with gains. Most top-cap cryptocurrencies including, Bitcoin (BTC), Ethereum (ETH), Binance Coin (BNB) and Cardano (ADA) were flashing green with the global crypto market value rising 2.17% to $1.05 trillion, according to data from CoinMarketCap. ImmutableX price led the top losers with a total drop of 1.64% in price (see figure below).

ImmutableX Price Stares Into An Abyss As Losses To $0.37 Loom

IMX price started the New Year on a positive note bouncing off the $0.37 support floor to stage a 102% rally that halted at the $0.75 psychological level. Note that the price was also rejected by supply pressure from this zone in early November when the FTX/SBF/Alameda Research debacle sent the price on a downward spiral.

At the time of writing, the ImmutableX price was facing rejection from this same level, hence the ongoing correction. This implies that the price action may have formed a double top at this level and the ongoing correction may continue sending the price 43% lower to tag the $0.37 support level, just as it happened in November.

This gloomy outlook was supported by the relative strength index (RSI) which shows that ImmutableX had been recently massively overbought, explaining the change in trend. The downward movement of this oscillating trend-following indicator suggested that the sellers had begun returning to the scene.

The first line of defense for IMX is found at $0.63. Other areas of support are found at $0.57, the $0.53 psychological level, and the $0.53 landing pad.

Perhaps the strongest support for ImmutableX lies within a significant demand zone stretching from $0.37 to $0.50. Note that this is where the price consolidated for more than a month before staging the amazing recovery that has been witnessed since January 1.  Additionally, the 50-day simple moving average (SMA) and the 100-day SMA are currently sitting within this buyer congestion territory both at $0.49.

IMX/USD Daily Chart

The significance of this support area was supported by on-chain metrics from IntoTheBlock, a crypto intelligence and blockchain data analytics firm. Its Global In/Out of the Money (GIOM) model showed that the support around $0.42 was relatively stronger compared to areas of resistance on the upside.

This foothold was within the $0.37 and $0.43 price range where a total of 30.4 million addresses are currently being held by approximately 8,040 addresses.

IMX GIOM Chart

Note that this price range also lies within the significant support area indicated on the chart. As such, any attempt by the sellers to push the price below this level would be met by massive buying from this cohort of investors who would want to see the price remain high to maximize their profits.

Therefore, even though IMX’s double top could spell doom for the token, its price sits on various support lines that are likely to weaken the sell-off. Additionally, the RSI is still positioned in the positive region at 65 suggesting that there are still more buyers than sellers in the market.

These buyers could lift the ImmutableX price from the current levels above the $0.75 local high to confront resistance from the $0.80 psychological level. Shattering this barrier could see IMX price climb higher first toward the $0.88 major blockade and later to the September 23 range high at $0.93.

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