Market uncertainty clouds INJ and OP outlook

Disclaimer: This is not financial or investment advice. You are responsible for any capital-related decisions you make, and only you are accountable for the results.

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Injective:

Overview

Injective ($INJ) has struggled to maintain key levels on the weekly timeframe, signalling weakness in its current structure. It failed to hold above the 200 EMA ($13.43), a crucial level for maintaining its bullish momentum and broke below its previous swing low of $11.37, which was formed during February’s broader market sell-off.

Currently, Injective is bouncing off the $10.32 support zone, a level that was previously acting as resistance back in 2022-2023, now flipped into support. However, this bounce lacks conviction, and unless Injective can reclaim its previous range, there is a risk of further downside continuation.

Analysis

Key levels & price action

Support levels:

• $10.32 (Current Bounce Area): The Injective is attempting a reaction from this level, but strength is yet to be confirmed.
• $8.00 (Major Monthly Demand Zone): If $10.32 fails to hold, a deeper correction toward $8.00 could occur, marking a retest of Injective’s long-term accumulation zone.

Resistance levels:

• $13.43 (200 EMA): A key level that must be reclaimed for any sustained bullish momentum.
• $16.80 (Previous Lower High): A breakout above this region would indicate a shift in structure, opening the door for a move toward $22.00.

Structural breakdown & weakness

• New lows: With Injective breaking below February’s swing low, it has now set a new local low, reinforcing its current downtrend structure.
• Choppy & uncertain price action: While a bounce from $10.32 is ongoing, momentum remains weak, making this level critical for Injective’s short-term direction.
• Potential retest of monthly demand zone ($8.00): If weakness persists, the Injective could enter a deeper correction phase, testing its historical accumulation range around $8.00.

Potential scenarios

Bullish scenario:

• Injective holds above $10.32, consolidates, and reclaims the 200 EMA ($13.43), signalling a potential recovery.
• If $16.80 is broken, it could initiate a trend reversal, allowing Injective to target $22.00 in the medium term.

Bearish scenario:

• If the Injective fails to hold $10.32, the price could continue to decline toward $8.00, where the monthly demand zone lies.
• A failure to reclaim the 200 EMA ($13.43) would reinforce bearish pressure, delaying any potential recovery.

Cryptonary’s take

Injective is on the edge after setting new local lows. Holding $10.32 is critical—if buyers step in, a recovery toward $13.43 and eventually $16.80 could take place. However, if weakness persists, a move toward $8.00 remains on the table.

For now, Injective looks choppy and weak, needing to reclaim key levels before signalling any bullish intent. Broader market sentiment will play a major role in Injective’s next move.

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Optimism ($OP):

Overview

Optimism ($OP) continues to trade in a choppy and uncertain range, struggling to establish clear directional strength. The asset has managed to hold above the key $0.95 structural level, which coincides with June 2023's low, but remains unable to generate momentum for a sustained move higher.

If wider market conditions deteriorate, $OP could revisit lower key support levels, including the $0.79 region (early February's sell-off low) and, if broken, the $0.65 level (October 2022's low). On the other hand, if OP manages to sustain its current range and reclaim $1.21, this would provide a stronger base for higher consolidation, opening the possibility of a move toward the $1.82 region in the medium term.

Analysis

1. Key support levels:
   • $0.95 (Structural Level, June 2023 Low): OP has held this region so far, preventing further breakdown.
   • $0.79 (Early February Sell-Off Low): If the market weakens, this is the next major downside level.
   • $0.65 (October 2022 Low): A critical historical level that could act as a last line of defense if the selling continues.
2. Resistance & potential upside:
   • $1.21: OP consolidated below this level throughout February. A reclaim could signal higher consolidation.
   • $1.82 (Medium-Term Target): If OP establishes a base above $1.21, this level could come into play.

Potential scenarios

1. Bullish scenario:
   • OP consolidates above $0.95 and reclaims $1.21, allowing for a gradual move toward $1.82.
2. Bearish scenario:
   • A breakdown below $0.95 could trigger a drop to $0.79, with $0.65 as a deeper downside target if selling persists.

Cryptonary's take

Optimism is weak and struggling to establish clear momentum. The $0.95 level is crucial-as long as OP holds above it, a range-bound consolidation remains neutral. However, a break below $0.95 could accelerate losses toward lower supports.

For now, chop continues-we need to see either a reclaim of $1.21 for strength or a loss of $0.95 for further weakness before taking a clear stance.