Injective (INJ) has officially broken the multi-month descending channel pattern, marking an important technical shift that could reset the price trend of this altcoin.
At the time of writing, INJ is trading at $12.6, after surging 15.26% just yesterday — completely negating the previous bearish structure and reversing short-term market sentiment.
This breakout has helped INJ surpass the descending resistance that has constrained its rise since December 2024. As a result, bulls are currently targeting the next resistance levels at $14.16 and $15.43.
Therefore, this breakout has rekindled bullish sentiment and INJ may continue to expand, provided that the upward momentum and trading volume are maintained.
Have traders really returned to the bullish trend after a long period of consolidation?
At the time of writing, Coinglass data shows that the funding rate for INJ remains at a positive 0.01% on the OI-weighted chart. This indicates that more traders are willing to pay fees to maintain long positions, reflecting stronger confidence in the bullish trend.
The funding rate turning positive typically occurs when market sentiment begins to shift, especially after breakout price movements or significant technical signals. Therefore, this development confirms that the overall market sentiment is gradually aligning with INJ's current upward momentum.
If the funding rate continues to remain positive and gradually increase, it could further reinforce the bullish trend, while reducing the likelihood of a sudden reversal.
Are whales signaling long-term confidence through large purchases in the spot market?
Data from the spot market indicates the emergence of 'Large Buy Orders from Whales', meaning that large investors are participating or increasing their INJ positions.
High volume trades like this are often a sign of institutional or whale presence and reflect increasing confidence in the market.
The participation of large investors during the current breakout phase often reinforces price action, while also reducing the likelihood that the rise is only short-term and easily reversible.
Overall, large buy orders flooding the market enhance the reliability of the breakout signal and indicate that upward momentum may remain strong in the near future.
Increased speculation leads to explosive price volatility?
According to the futures contract volume bubble chart, derivative activity around INJ has entered a 'warming up' phase. This is often a sign that trader participation in the derivatives market is significantly increasing, leading to a substantial likelihood of price volatility.
When this trend combines with a positive funding rate and a clear breakout structure, it suggests that traders are preparing for the next upward move or strong intraday volatility.
When speculative interest surges, price volatility also tends to become more pronounced — both on the upside and downside. Therefore, INJ's current setup reflects not only a return of market confidence but also carries a higher degree of risk, which could lead to strong breakouts in either direction.
Will the liquidation cluster above $13 trigger a Short Squeeze?
The liquidation map on Binance shows a high density of short orders clustered in the price range from $12.8 to $13.36. If the price of INJ continues to rise, short orders could be liquidated en masse, creating a Short Squeeze effect — pushing prices even higher.
These price levels act as pressure points where high-leverage short positions may be forced to close early, thereby adding further momentum to the upward trend. However, if INJ cannot surpass these levels, the upward momentum will stall or trigger a short-term correction.
Thus, traders should closely monitor INJ's price reaction around the $13 mark, as this is a key area that will determine whether the strong upward trend continues or if new resistance emerges.
Can INJ maintain the breakout beyond significant pressure zones?
INJ has broken out of the descending channel, combined with a positive funding rate, whale accumulation, and the vibrancy of the derivatives market, creating a strong technical setup.
However, the liquidation clusters in the $13 price range along with upcoming resistance levels may confirm the upward trend or slow down the current momentum.
The coming days will be crucial in determining whether this breakout will truly evolve into a broader bullish trend or be suppressed and weakened by market pressure.