Stacks is a leading blockchain project that seeks to grow Bitcoin’s utility.

STX price has surged hard after the successful launch of Ordinals.

It has become extremely overbought signaling a pullback is imminent.

Stacks, a small but fast-growing blockchain project, has become one of the best-performing cryptocurrencies in March. STX, its token, has soared to a high of $0.9800, the highest point since May 2022. It has jumped in the past three straight weeks and by 372% from its lowest point this year.

The main reason for the recent Stacks price surge is the ongoing bets of Ordinals, a Bitcoin NFT platform. Its launch, which has been highly successful, has led many analysts to predict that Bitcoin use case will become more pronounced in the coming years.

For many years, Bitcoin has always had little utility, unlike other blockchains like Ethereum and Internet Computer. This happened simply because Bitcoin does not have smart contract features. As such, it is not possible to build on top of Bitcoin. 

Stacks is one of the biggest blockchains that seeks to provide more utility for Bitcoin. Its technology makes it possible for developers to build dApps in all industries, including DeFi and Non-Fungible Tokens (NFTs). 

Stacks uses the proof-of-transfer mechanism that connects it and Bitcoin. It also has other features that make Bitcoin more programmable and productive. So, how high can STX price jump?

STX chart by TradingView

The daily chart shows that the STX price has been in a strong bullish trend in the past few months. It managed to cross the important resistance point at $0.5237, the highest point on August 8. 

It has jumped to the highest point since May last year and moved above the 50-day and 100-day moving averages while the Relative Strength Index (RSI) has moved to the extreme overbought level. The Stochastic Oscillator has also become extremely overbought. Stacks has also moved to the important resistance point at $1.

Therefore, it seems like STX has more bullish upside in the near term. However, with its price being extremely overbought, there is a possibility that a pullback will happen soon. If this happens, the coin will retreat to the next key support to watch will be at $0.5237, which is about 46% below the current level.

Such a retreat will be part of a break and retest pattern. In price action analysis, such a pattern is usually more bullish in the near term. 

The post Stacks price relentless bull run gains steam: is it still a buy? appeared first on CoinJournal.

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