Injective Protocol (INJ) has been gaining a rapid increase in its market value since the beginning of 2023. This impressive growth is driven by multiple elements, and potential warning signs may be seen through an on-chain perspective. INJ’s trading volume has sky-rocketed, indicating a large interest in the asset, although greater volumes are necessary to sustain its momentum. Additionally, the popularity of INJ on social media platforms has risen, which could point towards a local top coming soon.

Further to this, the Daily Active Addresses (DAA) of INJ have also experienced an increase; this is a sign of growing adoption and interest in the asset. However, a divergence could be spotted if the DAA starts to reduce while the price remains elevated, indicating that the momentum may come to an end. Additionally, Supply Distribution data suggests that the market is overpowered by retail investors, which could cause it to become unstable.

The 30-day Market Value to Realized Value (MVRV) ratio for INJ is currently at its peak for the past six months. This High-Risk Territory may lead to a price decline and formation of a local top, equating to the INJ price dropping to $7.18 or even $5.83. Crypto traders must be aware of these indicators and be cautious while investing in INJ.



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