The surge of Stacks (STX) stands out from the overall performance of the altcoin market, which has experienced a significant correction in the past few days.
Stacks (STX) has surpassed the $1.80 mark
as a primary blockchain solution, it embraces smart contracts and decentralized applications (dApps) for the Bitcoin (BTC) network, importing them while maintaining full functionality.
The price of STX has witnessed a significant increase since the end of November 2023. This rise has been swift and without any major setbacks.
Last week, STX encountered a flash crash, which was also observed across the cryptocurrency market. However, the price formed a lengthy lower wick (green icon), affirming the previous resistance as support. Subsequently, the token displayed a bullish weekly candle on the chart and continued its rally this week.
Currently, STX has reached a peak of $1.83, its highest price since March 2023.
Source: TradingView
The weekly momentum indicator RSI is ascending and above the neutral level of 50, indicating a bullish trend. Despite entering overbought territory, it has not generated any bearish divergence signals that would hint at an imminent decline.
STX Forecast: What about the $2 mark?
Although the weekly timeframe strongly suggests a bullish outlook, the daily chart is showing signs of weakness that raise doubts about the continuation of the uptrend.
Firstly, STX has been trading within an ascending parallel channel for the past 20 days. Such channels typically contain corrective movements, implying that a bearish breakout from the pattern is the most probable scenario. Additionally, the daily RSI has formed a bearish divergence (green line).
However, these indications do not serve as a definitive verdict that the coin is on the verge of a bearish breakout. This is due to the fact that Stacks has repeatedly attempted a bullish breakout, weakening the channel’s resistance line. Furthermore, the bearish divergence trendline is at risk of being breached.
Hence, if the price surpasses the upper boundary of the channel, it could surge by another 35% and encounter the next resistance at $2.40.
Source: TradingView
Conversely, a bearish breakout from the channel may lead to a 30% decline in STX, reaching the closest support level at $1.20.
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