SUI is currently testing a crucial supply zone following a massive 95% surge triggered by the Federal Reserve’s recent interest rate cut announcement. The explosive rally, driven by significant buying pressure, has led to volatile price action, raising questions about whether this upward momentum can be sustained.
As the SUI hovers near its current highs, market speculation increases around the possibility of a correction to lower demand levels, with $1.40 being the primary target.
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Key data from Coinglass reveals a decline in market demand, signaling a potential slowdown in purchasing activity. This has left some investors nervous as they anticipate a price drop in the coming days. The sudden rise has fueled optimism and caution as traders weigh the potential for continued gains against the risk of a sharp reversal.
With the SUI now at a critical juncture, the next few days will be crucial in determining whether the uptrend can continue or whether the market will return to more stable demand levels. Investors are watching closely, ready to adjust their strategies based on unfolding price action.
SUI financing rate signals price drop
SUI is at a critical point after days of extreme price movements and significant gains. Following the impressive 95% rally since the Federal Reserve’s interest rate cut announcement, some investors and traders are beginning to take profits, signaling a potential shift in market sentiment. Many now see a correction to $1.40 as inevitable, especially as buying pressure cools.
Coinglass important data suggests a cooling in demand, with the financing rate becoming negative to -0.067, marking an annual minimum. The funding rate is a key indicator in futures trading, representing the periodic payout between traders in long positions (betting on price increases) and those in short positions (betting on price drops).
When an asset’s funding rate turns negative, it indicates that more traders are opening short positions, expecting a drop in price. This shift reflects growing caution in the market as traders begin to position for a potential recession.
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With the financing rate so low and demand declining, the market is showing signs of cooling after SUI’s explosive recovery in September. As a result, investors and traders are now patiently waiting for a correction to reduce demand levels around $1.40, which could present new buying opportunities or signal further declines depending on broader market conditions.
Main Levels to Watch
SUI is currently trading at $1.73 after experiencing days of volatile price action. The price rose but stalled at the crucial $2 resistance level and has since entered a consolidation phase just below it. This key level has become a barrier for bulls, and a push above $2 is needed for SUI to regain momentum and confirm an uptrend.
However, the market remains uncertain and if the price fails to hold the $1.60 support level, a deeper correction could occur. Analysts predict that a break below $1.60 could lead to a 20% drop, bringing SUI into the $1.40 demand zone. This level is being closely monitored by investors and traders as critical support to avoid further downward pressure.
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As the market fluctuates, SUI price action remains in a delicate balance between a potential recovery and a further correction. The next moves around these key levels will likely determine whether the bulls regain control or whether the bears continue to push prices lower in the coming days.
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