GMX Coin Price, Check Out the Analysis and Predictions!

Bittime - GMX has had a rough start to 2024, with its coin price plummeting nearly 50% since the start of the year and hitting an all-time low on July 5. However, there are signs of a change in direction, as prices started to rise again in July.

Proposal Buyback GMX

One factor that could push GMX prices up is the recently approved buyback proposal. On July 20, the GMX board proposed to change the revenue distribution model from “ETH Buyback and ETH Distribution” to “GMX Buyback and GMX Distribution”. This proposal was approved on July 28 with 97.82% support.

This proposal aims to use between 30% to 70% of the fees earned from GMX v1 and v2 to buy back GMX tokens. This is expected to create buying pressure which can increase the price of GMX and maintain its stability. Additionally, users can still convert these tokens into ETH and AVAX to not reduce the user experience.

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Buyback Impact on GMX Supply

In the last 30 days, the cost of GMX v1 and v2 reached 86 million. The buyback could use around 25 million of that amount, which is equivalent to 892,857 GMX tokens or 9% of the circulating supply. Currently, the liquid supply of GMX on decentralized and centralized exchanges is only 1.75 million tokens, so buybacks could cause significant buying pressure.

Additionally, one wallet associated with the team holds more than 5.5 million GMX tokens, and $168 million of GMX has been staked, which is equivalent to 6 million tokens. Therefore, most of GMX's supply is illiquid, meaning the buyback program could create very significant buying pressure.

GMX Price Analysis

Source: TradingView

GMX has been on a downward trend since March 13, with a descending resistance line causing the price to hit a low of $22.10 on July 5. However, the price has risen since then and is now approaching that resistance line for the third time.

An important aspect of GMX's recent price rise is that the price has successfully validated the $24 horizontal area as a support level. However, technical indicators are currently still neutral, not providing a clear indication of whether the price will break the resistance line or not. The MACD is slightly above 0, and the RSI is at 50, indicating a lack of momentum in any direction.

GMX Price Prediction

Source: TradingView

GMX's daily chart shows a bullish pattern, hinting at a potential breakout. GMX has completed a five-wave downtrend from its June peak and started a five-wave uptrend from its all-time low. Based on this pattern, a possible target for the fifth wave peak is $37, which coincides with the 0.618 Fibonacci retracement resistance level.

This upward movement is likely the initial wave A of an A-B-C correction or the first wave of a larger five-wave rally. In both scenarios, the $37 area may be temporary resistance, but it is more likely that GMX price will break out and continue its rise, reaching at least the $43 resistance level.

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Conclusion

The buyback proposal for GMX could potentially have a positive impact on the price, especially since a significant percentage of GMX's supply is illiquid. Additionally, wave analysis suggests a potential breakout of the descending resistance line, which could trigger a price rise towards $43. Investors need to monitor these developments and consider economic fundamentals in making investment decisions.

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