Key Takeaways:
- IoTex token IOTX traded at $0.028 on Oct 7.
- The digital asset risked losing another 67% in the upcoming sessions.
- Meanwhile, IOTX correlated with Bitcoin for the past year.
YEREVAN (CoinChapter.com) – IoTex (IOTX) token had an indecisive week, much like many other altcoins, and its price traded at $0.028 in the European session on Oct 7. However, technicals pointed to a looming decline if IOTX confirms a bearish pattern.
IoTex (IOTX) Price in a Bearish Pennant
In short, the IoTex token formed a setup dubbed the ‘pennant’ that has been instrumental in determining short-term fluctuations since mid-May. The formation consists of two converging trendlines with a similar slope. They encapsulate the price action through consecutive support and resistance retests.
Unlike a similar pattern, the symmetrical triangle, the pennant typically forms after a significant move in either direction. It is a continuation pattern, meaning after the asset exhausts the formation, it is likely to resume the bias preceding the pennant.
IoTex token plummeted 30% before forming the triangle, which could lead traders to expect a similar drop. Moreover, the expected move would equal the preceding one. As a result, IOTX’s target price would stand at $0.008, or another 67% below the current value.
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Also read: Bitcoin’s ‘digital gold’ narrative is back? Strengthened correlation says yes
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The dropping trading volumes back the bearish prognosis, demonstrating growing indifference among traders and their unwillingness to take risks. However, IoTex was not alone on the bearish path.
IOTX Dependent on Bitcoin (BTC)
Meanwhile, the altcoin’s price action was not independent of the rest of the market. A chart comparison showed a distinct correlation between the IOTX price and Bitcoin, continuous for at least a year. IOTX moves generally surpassed BTC by stroke amplitude but followed the same general bias.
The said correlation underscores the importance of the macroeconomic picture. While altcoins can and do fluctuate on their own, in turbulent economic times, they tend to follow Bitcoin’s lead.
The latter is dependent on the Federal Reserve’s hawkish actions to stave off the ballooned inflation, the geopolitical instability across the globe, and the growing risk of a further downturn for the stock market.
Thus, while many factors unfold simultaneously, traders should proceed with caution and weigh investment decisions carefully.
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Also Read: https://coinchapter.com/cryptocurrency-price-sushiswap-sushi-syscoin-sys-vechain-vet-ens-dia/
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