Story (IP) Price Retraces After Reaching New High Following 115% Rally

Key Takeaways

• IP’s price rallied beyond $7 on Feb. 26, but the token has since fallen by 15% from that peak.
• The MACD shows bearish momentum around IP as social dominance has also dropped.
• IP seems to be facing rising selling pressure, suggesting the value could sink below $5.
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After outperforming the broader market for several days, Story (IP) price reached a new high of $7.33 on Feb. 26. Hours after that, IP’s price fell by 15% from that peak, temporarily pausing the staggering price increase.

IP, which is the utility token of AI-enable intellectual property blockchain project Story Protocol, launched on Feb. 13. Since then, after a bit of sell-off, IP’s price has increased by 115%.

But the excitement has been tempered with as the token retraces some of its gains. Considering the pullback, this analysis checks if the token can regain its strength or if the decline will continue.

IP Struggles to Maintain Momentum

On February 20, IP’s price surged to $6 after a steady upward movement from February 16. However, between February 20 and 24, the token faced a downturn, falling to $3.85 as it traded within a descending channel on the 2-hour chart.

IP found support at $3.87 on the same chart and breached resistance at $5.10, which helped it rally above $7. However, IP’s price has now dropped to $6.17, and indicators suggest that the decline may continue.

Out of the several indicators supporting this bias, the Moving Average Convergence Divergence (MACD) seems to be the most clear about it. Based on the image below, the MACD reading has dropped to the negative region, indicating bearish momentum around the token.

The 26-period Exponential Moving Average (EMA), in orange, has crossed above the 12 EMA (blue). This indicates a bearish. Should this position remain the same, IP’s price might find it challenging to rebound to $7.

Further, this decline seems to have spread to the attention the market gave IP. Earlier, social dominance jumped above 1%. But according to Santiment, it has dropped to 0.625% today.

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When social dominance rises, it indicates an increase in discussions around a cryptocurrency, signaling bullish sentiment for the price.

In this case, the decline suggests that conversations surrounding IP have decreased. If this trend continues, it could lower demand and negatively impact the price.

Bears Gain Control as IP Price Faces Decline

Like the 2-hour chart, analysis of the 1-hour timeframe supports an extended decline. According to the image displayed below, the Bull Bear Power (BBP) has dropped to the negative zone.

Since Monday, Feb. 24, the BBP reading has mostly stayed positive, indicating that bulls were in control. But now, bears seem to have the upper hand amid rising selling pressure.

Should this remain the same, IP’s price might drop to $4.20. However, this could change if the momentum turns bullish, and bulls can defend the support at around $5.64.

In that case, IP might be able to record a new all-time high, possibly climbing to $8 by then.