Ethereum is gaining ground, but from an objective standpoint, a clearer confirmation of a sustained bullish trend is still pending — with a key resistance zone ahead.

A similar technical setup is unfolding in the Injective Protocol token. While an initial buying setup has been identified, the broader market context continues to partially limit the potential for a full-fledged long position.

Injective protocol technical analysis

INJUSD - 1 Day Time Frame

Several days ago, the price of INJ swept Sell-Side Liquidity, followed by an impulsive daily close above the last resistance zone, which had previously defined bearish price action. For better visualization, we've marked this zone in orange on the attached chart.

The complication lies in the fact that, during the liquidity sweep, the price came very close to the next Sell-Side Liquidity level, suggesting potential for further liquidity buildup. From a retail trader’s perspective, this often appears as the price respecting an “imaginary” support level. In reality, however, it can serve as a trap — inviting further accumulation before a more decisive move.

To add to the analysis, the price is now approaching a larger and more significant resistance zone, marked in blue on the chart. This zone may serve as the true test of strength for any developing bullish scenario.

Injective protocol price target

In the coming days, price behavior around these zones will be critical. If INJ closes with the body of the daily candle below the orange support zone, it could confirm that the bullish attempt has failed, presenting a clear opportunity to enter a short position targeting the next Sell-Side Liquidity level.

Conversely, if the price manages to break and close above the blue resistance zone, it could confirm renewed bullish momentum — allowing for a long position targeting the Buy-Side Liquidity levels.

In either case, placing appropriate stop-loss orders are essential: for short positions, they could situate above the internal swing high; for long positions, they could be placed below the internal swing low.