New partnership news send IOTA/USD flying to its highest level since 2018, but a dip in sentiment is threatening further gains
IOTA is trading around $1.12, about 20% off this past week’s peak price. Earlier, the cryptocurrency’s price had dropped to lows of $0.95, which meant losses of up to 32% since prices touched $1.41, the highest level since 2018.
IOTA’s struggle as the new week begins comes after the cryptocurrency charted higher over the past seven days. The technical outlook now suggests it’s likely to sink further if bulls fail to stop the downward action above a major support level.
Why IOTA surged to a multi-year high
While most altcoins surged in the wake of Bitcoin‘s lull after retreating from highs above $48k, last week’s upside for IOTA’s price levels was largely due to a promising new partnership.
According to the IOTA Foundation, IOTA had struck a partnership with Dell Technologies on Project Alvarium. As the world’s first such project, Alvarium offers “a measurable way of evaluating the confidence in data before it is used by an application.”
Market reaction to the news saw IOTA/USD surge 32% in one day, shooting from $0.88 to $1.40. Upward momentum saw it continue higher, with candlesticks suggesting increased sell-off pressure. The downward action started after IOTA/USD reached what looks like a potential local top at $1.41 on 13 February
IOTA/USD price outlook
IOTA looked to have stemmed a two-year downtrend trajectory with recent price moves that saw it trade as high as $1.41. The weekly picture for IOTA shows the cryptocurrency surged almost 113%, rallying from lows of $0.55.
The technical picture suggests buyers still have the upper hand. The weekly RSI is in overbought territory but not overextended and is trending with a positive divergence. The weekly MACD is also trending with a strong bullish perspective. This means that the IOTA price might yet rebound, probably retesting the major resistance level at $1.40 with the next few days.
The last few hours have, however, seen increased selling threaten to send the cryptocurrency deeper into downward correction territory.
There is a resistance line formed at the local top and bulls could find it difficult to repeat last week’s rally. As the weekly chart shows, the bullish momentum is at risk of flipping bearish if prices fall below $1.12.
The daily chart shows successive red candles as bears push for lower prices. The indication here is that some investors might continue to see an opportunity to sell at profit with prices above $1.10.
While the MACD remains in the bullish zone, it’s showing signs of weakness. The daily RSI is also suggesting short term pain for bulls, with a dip towards $1.00 likely to invite further downward pressure.
If that happens, the key price level to watch would be the 20-day EMA, which provides support at $0.80. A bearish run below the moving average could open up IOTA/USD to a dump at $0.72, $0.56, and then $0.47.
The post IOTA price outlook: 20% dip puts IOTA/USD in the red zone appeared first on Coin Journal.
