Market data shared by Crypto Patel on X highlighted a large cyclical pattern in Injective (INJ) price behavior. The asset has fallen nearly 95% from its macro peak, a move that historically has often preceded strong recovery phases in past cycles.
The analysis suggests that the market is in a fair value gap on a high timeframe chart, where the buying interest may slowly offset the selling pressure.
This looks like a previous market phase, where the INJ price first went up quickly, then down significantly, and finally entered a re-accumulation phase.
From the chart, the prices are contracting while a downtrend resistance holds, indicating that the volatility is low as people wait for clear breakout signals. Analyzing past movements, the bullish movement in 2023-2024 provided more than 4,600% gains from the early base.
After such massive gains, there are always prolonged periods of pullbacks as early investors take profits and new money slowly enters the market. Currently, the region between $1.70-$2.70 is considered the major demand region.
Read More: Injective (INJ) Holds Channel Support – Wedge Breakout Could Target $25
The data from the TradingView charts indicates that the momentum is still weak. The price has recently been trading around $3.06, having fallen by about 13% in one week. This is in addition to the lower highs.
The RSI for the weekly chart is close to the oversold level of 30. Although an oversold condition can precede a bounce, it does not necessarily mean that a reversal is about to happen.
A downtrend can remain weak even when the momentum is considered to be stretched. There has not been any strong bullish divergence yet. Other indicators remain cautious. The MACD is below zero with only a small stabilization of the histogram.
The negative Chaikin Oscillator indicates outflows of money rather than buying. A bullish crossover and an increase in volume are usually expected before a trend change is confirmed.
The market configuration implies that a strong close below $1.10 could pose further risks of decline. This level implies that the long-term accumulation trade idea would be rendered obsolete.
For a reversal, the price would need to overcome the lower resistance line and establish higher highs. If momentum continues to change, long-term predictions for large-cycle targets are around the price levels of $80, and then potentially $200 if the bullish cycle continues for a longer period of time.
Volume during the sell-off appeared to be following liquidity rather than a well-structured sell-off. Longer lower-wick candles indicate that buyers have been attempting to drive the price higher, but sufficient demand has not yet taken hold.
Read More: Injective (INJ) Holds Channel Support – Wedge Breakout Could Target $25
