Quant Experiences a 14% Surge, But This Supply Zone Poses a Challenge for QNT’s Rally

Summary:
Quant's QNT token saw a noticeable price increase of 14% recently, reaching an investor confidence level of 88%. While substantial buying in the spot market and rising open interest in derivatives indicate positive momentum, a critical supply zone between $93.32 and $99.13 may hinder any further price increases. Investors are encouraged to stay cautious as market dynamics shift.

Key Takeaways

QNT's price rose by 14%, reaching $93, boosted by strong investor confidence.
Spot market purchases totaled $248,000, indicating renewed interest among buyers.
The significant supply zone between $93.32 and $99.13 may lead to price resistance and potential declines.
The Money Flow Index suggests increased capital inflow, but conflicting trends in the Accumulation/Distribution indicator raise concerns about profit-taking.

QNT rallies 14% as demand surges, but key supply zone threatens breakout

Understanding QNT's Recent Price Increase

Quant's QNT token has made a significant comeback, showing a strong rally of 14% within a single day. This surge has led to a robust investor confidence level of 88%, surpassing other cryptocurrencies that failed to reach double-digit returns. The current pressing question is whether this influx of capital can propel QNT beyond the crucial $100 mark.

What Is Driving QNT's Surge?

The primary reason behind QNT's recent upward trend stems from a notable convergence between buyers in the spot market and derivative investors. In the spot market, investors purchased an impressive $248,000 worth of QNT after experiencing two consecutive days of sell-offs, indicating a rebound in buyer interest following the dip.

Spot exchange netflow.
Source: CoinGlass

Additionally, derivative investors have also stepped up their involvement, with open interest rising to approximately $18 million, and $1.5 million added in the last 24 hours. This increase, along with the positive funding rates, signals that investors are gearing up for further upward movement in QNT's price.

As of now, QNT is trading at $93 and appears to be approaching the $100 target. Nevertheless, there are indicators suggesting that this may not be a straightforward ascent.

Major Supply Zone Ahead

A significant barrier for QNT lies within a supply zone that stands in the way of its price movement. This supply zone represents an area where unfilled sell orders accumulate, often triggering downward pressure when the market approaches it.

Currently, the critical supply zone resides between $93.32 and $99.13, having previously rejected price attempts on two occasions—first leading to a notable drop of 27.73%, and then causing another decline of 27.06%.

QNT price chart.
Source: TradingView

Should QNT encounter a similar situation again, the asset could potentially fall by an average of 27.3%, bringing its price down to approximately $70. However, there remains an opportunity for upward movement if QNT successfully breaks through the supply zone. Notable resistance levels include $104, $113, and a peak at $121.

Increasing Capital Inflow with Caution

In the past day, there has been a notable increase in capital inflow into the market as indicated by the rising Money Flow Index (MFI). An MFI above the 50 level signifies that new capital is entering the market, confirming that bullish sentiment is strong among investors.

However, conflicting signals exist as the Accumulation/Distribution (A/D) indicator suggests that tokens are being distributed. The trading volume has dipped to 970,000, indicating that while some investors are profiting, they are not initiating a large-scale sell-off.

QNT technical chart.
Source: TradingView

If both the Distribution metric and the MFI start to decline simultaneously, it could put QNT in a precarious position, possibly leading to significant losses for investors, as a notable price plunge may follow.

Final Thoughts

In conclusion, while QNT has recently experienced an impressive rally, the looming supply zone presents a substantial challenge. Investors should remain vigilant and informed as market conditions continue to evolve, balancing both optimism and caution in their trading strategies.