Altcoins made significant gains earlier today, but things took a turn with the opening of the US markets. However, there are some positive outliers in the past 24 hours, with IMX Coin leading the pack. Let’s recap what caused the price increase and take a look at the current price predictions.
ImmutableX (IMX) reached a peak of $0.77 on Thursday. Although it lost a significant portion of the price gains after breaking away from the descending resistance line, it still reached a 40% increase. Since March 18th, when the IMX price reached its highest level of $1.59 this year, it has been trapped in a descending wedge. A descending wedge is considered a bullish formation, meaning that a breakout from this formation is the most likely future price scenario.
This downward movement was halted approximately 10 days ago when it confirmed the $0.5 horizontal area as support. The bounce was particularly interesting as the price didn’t drop to the support line of the wedge. It reflected strong demand from the bulls.
Although the breakout seems to indicate the precursor to a long-term rally, the upper wick on the chart highlights the dominance of profit-taking. Bear markets in altcoins often reverse upward movements with such profit-taking. Additionally, the rapid shift in overall market sentiment to the negative also played a role.
In summary, the price increase was based on a breakout from a long-term formation, and the sentiment in altcoins turned positive in the early hours due to MtGox, which provided support for the price.
Now let’s move on to the most important part. What will happen next? Technical analysis does not show the future, but it can predict where people should look and how they can position themselves accordingly. IMX will likely return to the $0.5 support area, which means the price could experience a significant drop from its current level of $0.64 at the time of writing.
The unconfirmed breakout on the daily chart is similarly not confirmed on the six-hour short-term chart. This indicates a bearish expectation. Ultimately, if the price remains below the $0.70 resistance line, a potential 25% decrease is highly likely. However, if this level is surpassed due to a surprising improvement in overall market sentiment or an excessive demand for IMX, the price could rise by 55%.