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  • The Graph price crashed  35% since March 9 as it approaches the lower trendline of a horizontal parallel channel.
  • The sell-off might continue if the crucial demand zone ranging from $1.5 to $1.45 is breached.
  • Declining network activity and growth suggest a bearish outcome for GRT.

The Graph price will face a decision as it slides towards a confluence of support. Based on GRT’s reaction here, it could either surge higher or enter a corrective phase.

The Graph price at crossroads

The Graph price has suffered a bearish fate ever since it hit a new all-time high of $2.89 on February 12. Since this point, GRT has pulled back nearly 55% and is currently trading around the $1.52 level.

However, the Graph price’s clockwork-like price movement since February 23 has formed two swing highs around $2.11 and three swing lows near the $1.50 level.

A horizontal parallel channel evolves when the pivot points are connected using trend lines. This pattern does not have an inherent bias, and hence, the breakout isn’t confirmed.  

A bearish breakdown of the setup forecasts a 30% downswing to $1.05, determined by adding the channel’s height to the breakout point at $1.50.

GRT/USDT 12-hour chart

GRT/USDT 12-hour chart

Adding credence to this bearish outlook is the contrast between the overhead barriers and support levels for the Graph price portrayed by IntoTheBlock’s In/Out of the Money Around Price (IOMAP) model.

IOMAP cohorts reveal that roughly 460 addresses purchased 18.17 million GRT at an average price of $1.47. So, a  sudden spike in bearish pressure leading to a decisive close below this level could trigger a sell-off from panicking investors, further supporting the pessimistic outcome for GRT.

The Graph IOMAP

The Graph IOMAP

The daily active addresses transacting on the GRT blockchain reduced from 7,326 to 1,554, a 78% drop in the number of unique addresses. This reduction signifies investors’ disinterest or fleeing capital, which paints a bearish picture for the Graph price.

Likewise, the network growth metric, which tracks the blockchain’s user adoption, has declined 80% since February 12, adding to the already grim outlook for GRT.

The Graph Network Growth and Daily Active addresses chart

The Graph Network Growth and Daily Active addresses chart

However, considering Momentum Reversal Indicator’s (MRI) breakout line at $1.45, a bounce seems likely. Adding credence to this upside move is the presence of the 50% Fibonacci retracement level around $1.49, coinciding with the setup’s lower trend line.

Hence, this confluence of support ranges from $1.5 to $1.45, provides stable grounds for a lift-off. Therefore, a spike in buying pressure could propel the Graph price by almost 19% to the horizontal parallel channel’s middle line at $1.78.

A 22% upswing to the upper boundary at $2.11 seems likely if the bullish momentum persists.