August token unlock tests SUI holders as long-term downtrend persists
The Sui token unlocks and long-term bearish trend remain a threat to holders.
Sui [SUI] crypto was down 8.76% over the past week and has slid 1.43% in the past 24 hours. By comparison, Bitcoin [BTC] was up 0.5% in 24 hours.
Coinalyze data showed that the spot CVD for the altcoin has been in decline over the past two days. The Open Interest also slid lower as prices fell from $0.72, but the funding rate remained positive.
It showed that market sentiment in the short-term was bearish, but aggressive short selling has not yet commenced. Negative funding rates and rising Open Interest could lead to a price bounce and a short squeeze.
As things stand, there were other threats to traders and investors.
Token unlocks and long-term Sui crypto downtrend loom upon the bulls
The Sui recovery was under pressure. A SUI token unlock of 13.72 million tokens, worth $9.76 million, will be unlocked on August 1. Over the past 30 days, 22.76 million tokens have already been released in four events.
Unlocks signal supply pressure and potential short-term selling as the tokens become available to early contributors. Moreover, only 40.6% of the vesting schedule is complete, which means there will be more unlocks in the future.
The 1-day swing structure of SUI crypto was firmly bearish. The latest impulse move downward from $1.42 to $0.65 in May, and early June has set the stage for a potential bounce into the Fibonacci golden pocket between $1.12-$1.25, the 61.8%-78.6% retracement levels.
Over the past two months, the altcoin has been in a consolidation phase.
Traders’ call to action- Watch the range
The past two months’ consolidation had resulted in a SUI range formation [purple] between $0.70-$0.77. At the time of writing, the altcoin was trading almost exactly at the range lows.
A liquidity sweep toward $0.69 has occurred in recent hours. Another such sweep is possible in the coming days, if SUI crypto does not react bullishly soon.
As things stand, swing traders can look to buy, targeting the range highs around $0.775. Invalidation of the range formation would occur upon an H4 session close below $0.692.
Final Summary
- The Sui token unlocks and long-term bearish trend is testing investors’ conviction.
- As things stand, swing traders have a chance to buy, anticipating a 10% rally, but a breakout past $1.42 is needed to flip the long-term trend bullishly.
