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- Synthetix’s implementation of the 2043 SIP stops SNX inflation, adopting a more stable economic model.
- Technical analysis shows bullish signals for SNX, with the possibility of overcoming the $7 resistance.
This week, the price of Synthetix (SNX) has experienced a significant jump, reaching a high of $4.95, its highest in nearly 600 days. This increase follows a key decision at the platform: the implementation of SIP 2043, putting an end to its token inflation.
This trend has been characterized by a strong and aggressive bull stance, resulting in the formation of a highly bullish pattern. The persistent rise in the price of SNX has led to a significant change in market dynamics, with the bulls clearly demonstrating their control in the.
Key Data and Indicators
In terms of technical analysis, SNX price has shown signs of initiating a substantial rally, with more upside potential on the horizon. The Moving Average Convergence and Divergence (MACD) curve has indicated a positive crossover, reinforcing the bullish momentum. However, the Relative Strength Index (RSI) at 73 points to overbought conditions, which could be a concern for short-term bulls, signaling a possibility of a slight pullback.
SIP 2043 marks a major change at Synthetix, eliminating SNX token inflation. This strategy responds to the reduced effectiveness of inflation as an incentive for staking. It reflects the protocol’s commitment to a sustainable economic model.
Beginning in 2019, SNX inflation sought to boost staking. However, it generated confusion and questions about its inflationary model. SIP 2043 responds to these concerns by changing staking incentives. Synthetix now prioritizes strategies such as buybacks and burns, using trading commissions. To date, the protocol’s Perps have collected more than 28.5 million in commissions, validating this new direction.
The staking process has been simplified
Weekly claims are eliminated and a revamped reward structure is introduced, benefiting both stakers and non-stakers. For stakers, it involves free loans against SNX collateral, automatic commission burns and a rebuy and burn strategy. Non-stakers benefit from a reduced SNX offer due to Andromeda Release commissions.
This change at Synthetix ushers in an era of efficiency, where sustainable trading commissions replace inflationary incentives, outlining a more robust and user-friendly protocol.
In terms of price predictions, technical analysis on weekly time frames shows an uptrend. Price action indicates that SNX has broken a downward resistance and a horizontal resistance zone at $3.20. These factors suggest upside potential. The weekly RSI, above 50 and in overbought territory, supports this view.
If the uptrend holds, SNX could rise 60% and touch resistance at $7. However, an abrupt rejection could result in a 30% drop towards $3.20 support, without invalidating the long-term uptrend. A drop below $3.20 at weekly close would signal a significant decline.
Synthetix Price for 2024
Overall, the Synthetix price forecast for 2024 remains very bullish, with technical analysis favoring a continued uptrend. The confident stance of buyers and the chart pattern both support this outlook. If the bulls take control of the supply zone, SNX could potentially rise to $6 and above by the end of January 2024. Key support levels to watch are at $3.31 and $2.49, which could provide crucial information on the token’s near-term trajectory.
