Sudden spikes, new institutional buying, and scaling potential created a panic buying situation on the IOTA counter. This movement was, however, countered by the steep profit booking we witnessed on September 07. As a result of buyers retracing from trading, we saw one of the steepest falls in cryptocurrencies. As a result, IOTA was hit by a close to 60% sell-off.
Taking support from the $1 valuation as a good buying level and engagement of buyers from the last week of September 2021 helped IOTA reclaim its gains of the previous month. IOTA holds the 43rd position in market capitalization and is currently worth $4.14 billion, with over 2.779 billion coins in circulation.
One significant aspect of IOTA is that it is not a blockchain but a distributed ledger. It uses blockchain equivalence of Tangle and nodes to confirm transactions, enabling IOTA to offer much faster transaction leads and is an ideal candidate to support the increasingly speeding internet ecosystem. However, being just a five-year-old network, IOTA has a much larger canvas to finish and unscale in terms of market capitalization and scalability.
IOTA Eyes $2 After Trendline Support
A similarly trending selling action followed the phenomenal buying spree. As said, good things grow with time, and IOTA investors would have learned their lesson of steady price action. By any means, the previous high of $2.4 was not unjustified considering the increase in the use of IoT devices.
When we see IOTA price action since July 2021, we can consider that this cryptocurrency never broke its trend line. Instead, the spike of last week in August was correct in the preceding month of September. The correction soon converted into a profit booking enforced by lesser volumes, which was the only positive side of this sell-off. Considering this narrative, we can expect IOTA to continue climbing up steadily.
Touching $1 was a buying signal, and buyers helped the IOTA price correct to the trendline. As of now, IOTA seems pretty strong, with intense buying and trading above the critical support levels. Even the 200-day moving average is trading below the current $1.47, while the 200 DMA comes around $1.35 levels.
Long-term prospects put IOTA in double digits, but for now, $2 is achievable within a month. After that, profit booking can, at max, push it down by 30%, but the upside is close to limitless unless a more substantial Internet-based cryptocurrency arises.
RSI on this price action is vital, but it is yet to reach the overbought zones. RSI is currently active at 56 and still moving upwards. Alongside RSI, the MACD indicator also moves upwards and has already given a golden crossover pattern a few days before crossing the 200 DMA. Combining the golden crossover, increasing buying sentiment, and the 200 DMA curve support, IOTA should reclaim $2 before showing any sign of weakness.
