WazirX’s original token, WRX, benefited significantly from India’s latest pivotal cryptocurrency this week.
WRX award jumps on Indian tax news
The price of WRX rose nearly 30% to more than $1 and reached its highest level in three weeks after the Indian government announced a new tax regime for the regional crypto sector, completely abandoning its previously strict stance, and even calling for a complete ban on emerging . industry.
In his budget speech on Tuesday, Finance Minister Nirmala Sitharaman said the government plans to tax revenue from trading in cryptocurrencies at a rate of 30%, which, despite being among the highest in the world, also means that digital assets are recognized in India. . And soon it will have legal status.
The price of WRX jumped after Sitharaman’s speech, possibly due to his connection with India-based crypto exchange WazirX. The WRX token acts as an additional token on the platform, giving users discounts on trading fees and access to new token gifts.
Another 250% hike in the future?
Utility tokens typically derive their value from the assumption that their adoption will grow as their platform grows, which is no longer in a regulatory stalemate.
Javon Marks, an independent market analyst, predicted an additional price boom in the WRX market, noting that the WazirX token could rise to $3.80 from today’s $1 level. His bullish analogy was based on the technical setup, as shown in the accompanying chart.
Three-day WRX/USD exchange rate chart. Source: Javon Marks, TradingView
In particular, the ongoing WRX price boom has caused the price to break above the resistance line for several months. Marks noted that the “technical” hack would allow the WazirX token to gain another 252% in the coming sessions to target resistance levels in April 2021.
“As long as WazirX maintains this penetration, this target can be strengthened,” the analyst tweeted on Wednesday.
The announcement also came as the cryptocurrency market as a whole remained in turmoil after the disappointing January numbers. WRX itself is down more than 30% in one month, reflecting similar moves for top-tier cryptocurrencies including Bitcoin (BTC), which is down nearly 18% in the same period.
Medium Reflection Scenario
However, WazirX’s daily correlation with broader crypto market trends puts WRX at risk of a continuation of the downtrend. This is primarily because the catalysts that played a major role in the digital asset downturn in January 2022 – the US Federal Reserve’s hawkish shift – remain intact.
Related: Bitcoin Returns to Earnings After Fed Comments ‘Adding Downside Risk’ to Crypto Markets
In addition, WRX price is facing a technical confluence of resistance, which may limit the tendency to recover in the upcoming sessions. In particular, the range of price caps, including the upper trend line of the descending triangle, has already limited WazirX’s attempts to rise.
WRX / USD daily with a descending triangle. Source: Trading View
Other resistance levels include the 50-day EMA (the 50-day EMA; the red wave) and the 200-day EMA (the blue wave). A pullback after testing it may send WRX price to the lower descending triangle trendline around $0.75.