IOTA Surges 50% Since January 24 Lows as Bullish Momentum Continues

IOTA (IOTA) seems to be mired in a long-term correction, and could break out after a period of consolidation.

IOTA has been decreasing alongside a descending resistance line since Sept 4. More recently, the line caused a rejection on Dec 30 (red icon). 

This led to a low of $0.69 on Jan 24. The price has been moving upwards since. 

Currently, it is trading inside the $1.05 area, which had previously acted as support since Sept 27. Now, the area is expected to act as resistance once more. 

The aforementioned descending resistance line is currently at $1.10.

Technical indicator readings

Technical indicators for IOTA in the daily time-frame are relatively bullish, since both the MACD and RSI are increasing. 

More importantly, the RSI has moved above 50. The RSI is a momentum indicator and the 50 line is considered a threshold for a bullish/bearish trend. 

While the MACD is moving upwards, it has not yet crossed into positive territory. This would go a long way in confirming the bullish trend.

The $1.08 resistance area, which is created by the 0.382 Fib retracement resistance level coincides with the previously outlined horizontal resistance area. Therefore, its reclaim would be a major bullish development.

IOTA wave count analysis

Cryptocurrency trader @Thetradinghubb tweeted a chart of IOTA, stating that the price is consolidating inside what is likely a fourth wave triangle.

The most likely wave count does suggest that IOTA is in wave four of a five wave upward movement, which began on March 2020. 

On July 2021 and Jan 2022 (green icons), the token bounced at the middle of a parallel channel connecting waves one and two. This effectively completed a fourth wave pullback, supporting the possibility that IOTA is still in wave four.

If correct, the aforementioned Jan 24 low should not be breached. Rather, after a move towards $1.55 and a period of consolidation, IOTA would be expected to break out and move towards new highs.

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