TRON’s TRX price could crash more than 16% if Huobi’s insolvency rumors and Justin Sun’s involvement are true
- Huobi crypto exchange is knee-deep in alleged rumors that are harming the platform’s reputation.
- The insolvency rumors could affect Justin Sun, who is a global advisor of the exchange, as well as his personal project TRON and its token TRX.
- TRX price could easily slide 16% and reach $0.06375, resting below sell-side liquidity.
- In dire cases, the altcoin could extend the drop from 15% to nearly 40% as it retests the $0.04630 level.
Huobi exchange is the latest crypto platform that has come under the watchful eye of crypto sleuths. Adam Cochran, a crypto analyst, speculated on the social media platform X how Justin Sun could be using the Huobi exchange as his personal piggy bank. He also alleged that the platform could be insolvent and urged users to get their funds out.
Read more Huobi coverage: TRON’s Justin Sun battles negativity surrounding Huobi insolvency after 12% weekly decline
According to Cochran, Justin Sun, who is leading the Huobi exchange, could be hiding Huobi’s insolvency. If the alleged rumors have substance, then Sun could be in legal trouble, and the ripple effects could easily negatively impact his TRON project’s token TRX price, which has already slid 18% in the last 17 days.
TRX price could dive deeper than expectations soon
TRX price produced a massive 17% rally in three days, starting on July 21. But this impressive uptrend was undone, leading to a three-day return of just 3.27%. This sell-off was soon accompanied by more bears, which led to a total retracement of 18% in the last 17 days.
The formation of a bearish breaker zone, extending from $0.08041 to $0.07613, is a key area to watch. A breaker is essentially a failed demand or supply zone. For a bearish breaker, a key demand zone between two higher highs is breached to the downside.
TRX price is yet to breach the aforementioned three-day bearish breaker, but investors can jump on the short trade a little early. In that regard, a retest of the two-day breaker’s lower limit at $0.07858 could also be a good place to open short positions.
The ideal level for bears to book profits is the equal lows formed at $0.06375, resting below which are sell stops. This move would constitute a 16% plummet for TRX holders. While this crash might seem steep, investors can expect the altcoin to extend to $0.04630, which would constitute a total crash of nearly 40%.
TRX/USDT 3-day chart
On the other hand, if TRX price produces a higher high above $0.08571, it would create a higher high relative to the June 3 swing high. Such a move could attract sidelined investors and increase the overall buying pressure, triggering a rally.
In this situation, TRX price could rise roughly 50% and target the buy stops above the November 15 swing high at $0.1296.
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Author
Akash Girimath
FXStreet
Akash Girimath is a Mechanical Engineer interested in the chaos of the financial markets. Trying to make sense of this convoluted yet fascinating space, he switched his engineering job to become a crypto reporter and analyst.
