SUI’s inflow surge – Could this lead to a new breakout for its price?

• Stablecoin inflows and Open Interest suggested rising speculative confidence in SUI
• Liquidations reset leverage as funding rates flipped positive, hinting at bullish momentum

Sui [SUI] recorded the highest stablecoin inflows among all blockchains in the past 24 hours, with a net increase of $6.1 million. These sharp inflows coincided with most chains like Ethereum, Solana, and BNB Chain seeing notable outflows – A sign of potential capital rotation. 

Such strong stablecoin movement towards SUI hinted at growing demand and a hike in on-chain activity. 

Moreover, stablecoin inflows often act as dry powder, ready to be deployed into native assets – Adding potential upside pressure. Therefore, this liquidity surge could reflect investor confidence in SUI’s near-term outlook.

Why is Open Interest rapidly rising?

Open interest on SUI surged by 30.64%, bringing the total to $785.35 million. This sharp increase highlighted aggressive positioning in the derivatives market, especially as traders prepared for potential price volatility. Unlike spot inflows, Open Interest reflects speculative intent, with traders either hedging or leveraging directional bets. 

However, when combined with rising stablecoin inflows, it typically leans bullish. Therefore, the synchronized jump in both metrics could mean that traders expect a decisive move from SUI in the coming sessions.

Price action eyes key resistance after bullish push

SUI recently formed a classic cup and handle pattern on the daily chart, a setup often associated with bullish continuation. At the time of writing, SUI was trading at $2.16, up 12.82% over the last 24 hours. The handle portion of the pattern seemed to be shaping within a descending wedge, with a breakout point clearly marked at $2.23. 

However, buyers are yet to secure a strong candle close above this level. If momentum holds and the price breaks out, the next significant target would sit at $2.80. Therefore, this pattern, combined with growing momentum, could position SUI for a potential trend reversal.

Are liquidations and funding rates aligning with bullish momentum?

Over the last 24 hours, Sui saw $860.6k in long liquidations, compared to just $269.3k in shorts. This imbalance suggested that overleveraged bulls were flushed out, especially on major exchanges like Binance and OKX. 

However, liquidation events often act as reset buttons, clearing excessive leverage and setting the stage for a more sustainable move. If bullish momentum returns post-liquidations, it could support a healthier price recovery.

Meanwhile, Sui’s OI-weighted funding rate turned slightly positive at 0.0087% on 10 April. This suggested that traders have been paying to hold long positions, reinforcing the presence of bullish sentiment despite recent volatility. 

Additionally, funding rate recovery after a liquidation sweep often reflects renewed confidence among market participants. Therefore, if both funding and inflows remain elevated, the altcoin may be positioning itself for another leg up.

Conclusion

At the time of writing, SUI seemed to be showing several promising signs that hinted a breakout may be forming. The combination of strong stablecoin inflows, rising Open Interest, recovering funding rates, and a bullish cup and handle pattern pointed to growing market confidence too. 

However, the price is yet to confirm a move above $2.23 – A critical resistance level. Therefore, while the setup might be constructive, confirmation is key before calling a definitive breakout.