You can also read this news on BH NEWS: Injective Token Faces Pressure
Injective’s native token, INJ, has experienced a significant decline of 18.77% over the past five days. Some investors are contemplating buying the dip, but on-chain data indicates that INJ might face further losses depending on market conditions. The Market Value to Realized Value (MVRV) ratio, a critical metric for assessing investor sentiment, currently sits at 15.35%. This low ratio suggests that investors may be less inclined to sell at this time.
The MVRV ratio is vital for understanding investor behavior. As of now, the 30-day MVRV ratio for INJ stands at 15.35%, indicating low profitability for investors. This is somewhat higher than the ratio on July 23, implying a reduction in unrealized losses for some.
Despite a strong year-to-date performance, some investors might be exiting the cryptocurrency, potentially triggering a sell-off. This could exert additional downward pressure on INJ’s price, as reflected in the on-chain market depth metrics from 20 exchanges.
Currently, INJ is 54.25% below its all-time high. The daily chart shows a descending channel between June 13 and July, which is typically bearish. However, INJ broke this pattern, peaking at $28.12 before the RSI value started to drop again.
If INJ’s price declines, the critical support level to watch is $20.22. A failure to maintain this could see INJ falling to $18.19. Conversely, a potential rise in Bitcoin‘s price might boost INJ, given their strong correlation.
In conclusion, while INJ shows signs of potential future declines, key indicators and market conditions will play a crucial role in determining its trajectory. Investors should closely monitor critical support levels and Bitcoin’s performance for any signs of a rebound.