Decentralized cloud storage network Storj (STORJ) saw its price surge by 147% over the past five weeks, peaking at a resistance level of $0.542 on Monday. However, the cryptocurrency is now encountering a significant hurdle, struggling to maintain its upward momentum.
The impressive rally led to liquidations of around $20 million, negatively impacting both long and short positions. The total open interest has witnessed a 35% decline over the past month, currently standing at approximately $132 million.
Despite the recent price surge, a bearish divergence is visible when comparing the latest price action with the Relative Strength Index (RSI). This divergence suggests an imminent correction for STORJ. Analysts anticipate a price spike to Monday's swing high before this correction occurs.
In the aftermath of this expected spike, a drop to the $0.331 support level could follow, resulting in a total correction of up to 32%. This potential downturn underscores the volatile nature of cryptocurrency markets and the need for investors to exercise caution when trading in such assets.
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