Injective (INJ) has captured the attention of traders and analysts alike, as bulls work hard to defend a crucial support level at $21.65. This level is seen as vital for maintaining the cryptocurrency’s bullish momentum. At the time of writing on December 17, 2024, INJ was priced at $27.77, reflecting a modest 0.46% drop over the past 24 hours and a 1.66% decline over the past week. However, despite these minor setbacks, there are several signs that suggest strong market confidence, with a notable 9.54% increase in trading volume.

The key question now is whether INJ can hold the $21.65 support long enough to fuel a potential 12x price surge, with some analysts projecting a price target of $380 if the current trend persists.

Bullish Technical Patterns: The Case for a 12x Surge

Injective has recently broken out of a prolonged downtrend, forming a rounded bottom pattern—a classic bullish signal. This breakout has drives renewed optimism, as buyers have successfully defended the $21.65 support level, a move that analysts believe is crucial for the continuation of the bullish trend. If the price continues to hold above this key level, analysts are forecasting a potential 12x increase in the price, pushing INJ towards the $380 mark.

The bullish case is supported by the chart structure, with buyers remaining in control after a strong rally. Holding above the $21.65 support will be critical to maintaining this momentum, and many are watching to see if INJ can continue its upward trajectory in the coming weeks.

Technical Indicators: A Mixed Signal

While the overall outlook for Injective remains positive, the technical indicators provide a mixed signal. In November, the 13-day moving average (MA) crossed above the 49-day MA, a move known as a Golden Cross. This typically signals a bullish trend. However, the price has recently dipped below the 13-day MA at $29.06, while still staying above the 49-day MA, which currently acts as a critical support level. If the price fails to stay above the 49-day MA, the next key support level would be around $20.31, which could potentially slow the momentum.

Additionally, the Relative Strength Index (RSI) is currently at 47.63, indicating neutral to slightly bearish momentum. The RSI’s position below the 50 level suggests that buying interest has weakened, which could be a concern for bulls looking to push the price higher. For the bullish trend to regain full control, INJ would need to break above the $29.06 resistance level and push towards $32 in the short term.

On-Chain Data and Network Activity: A Mixed Picture

On-chain data from IntoTheBlock reveals a decline in network engagement for Injective. The number of active addresses dropped by 11.34% over the past week, while new addresses fell by 21.66%. This decline in network activity could signal a decrease in user interest, which is typically a bearish sign. Additionally, the rise in zero-balance addresses by 1.87% suggests that some users may have moved funds or closed positions, further adding to concerns about declining engagement.

However, despite the dip in user activity, the network’s fundamentals remain solid. Existing users continue to support the ecosystem, and the slight decrease in activity is not enough to overshadow the overall positive sentiment surrounding INJ.

Futures Market Interest: Signs of Confidence

While on-chain data presents some challenges, futures market data paints a more optimistic picture. Open Interest (OI) for INJ futures stands at $174.37 million, showing a slight 0.80% decline. However, OI has been on an upward trajectory since October, signaling sustained participation from traders. Additionally, trading volume has increased by 9.54% to $271.95 million, indicating ongoing interest in futures markets.

The rise in trading volume and steady futures interest suggest that investors are still confident in INJ’s potential for future growth. Despite the dip in network activity, these factors point to a strong investor base that continues to bet on Injective’s future success.

Conclusion: Can INJ Maintain Its Momentum?

Injective is at a critical juncture. The $21.65 support level remains key for the continuation of the bullish trend, with analysts eyeing a potential 12x surge to $380 if the price remains above this threshold. However, mixed technical signals, a decline in network activity, and a slight dip in futures open interest present some challenges.

For the bullish outlook to remain intact, INJ needs to break above the $29.06 resistance and maintain momentum above the $21.65 support. With strong futures interest and rising trading volume, the potential for further upward movement is still alive, but it will require a concerted effort from bulls to push through the resistance levels.