Is INJ Set for a Trend Reversal?

Injective Protocol has been attempting to establish a bottom since April, and shifts in social media sentiment could play a pivotal role in influencing its trend.

Daily time frame analysis

INJUSDT - 1 Day Time Frame

Injective recently tapped into its first range bottom from this bull market, showing a strong reaction and moving above the February 2021 high. For Injective to become an attractive trade for the second time in this bull market, it needs to confirm this bottom by re-entering the April-July range.

However, it’s crucial to wait for a confirmation of an ongoing upward trend, as this area currently acts as resistance. Should the broader market regain momentum, this resistance might weaken.

The most reliable confirmation would occur if Injective builds more value in the upper section of the April-July Fixed Range Volume Profile. An ideal entry point would be on a breakout from the small Value Area High (VAH) at $29, with targets set at the October-March VAH or beyond.

Injective remains in a downtrend, so waiting for a clear trend reversal is essential. If Injective loses the October-March Point of Control (POC), it could potentially retrace the entire bull market trend, leading to further declines.

4-Hour time frame analysis

INJUSD - 4 Hour Time Frame

Today's Consumer Price Index (CPI) report came in lower than expected, which negatively impacted the crypto market. Despite this, Injective has so far remained relatively stable. However, there is a possibility that Injective could lose its 4-hour trend in the coming days, with a potential bearish cross forming between the moving average bands.

It’s critical for Injective to hold the February 2021 Pivot upon retesting; failure to do so could lead to a retest of the swing low, with further downside likely afterward.

If Injective manages to bounce between the 12/21MA bands on the daily timeframe, this could present a promising entry opportunity, targeting the marked swing highs or the April-July VAH.

Injective's current position requires cautious optimism. While it has shown signs of resilience, confirmation of a trend reversal is crucial before making any trading decisions.

Traders should closely monitor key support and resistance levels, particularly the February 2021 Pivot and the October-March POC. A successful bounce and sustained upward movement could signal a strong entry point, but the potential for further downside remains if these critical levels are breached.