The Sandbox falls 10% – Can SAND’s bull flag survive the sell-off?

The Sandbox [SAND] is down more than 10% in the past 24 hours, leading all major gaming tokens in daily drawdown. The altcoin surged by more than 80% in the month of September.

Why is The Sandbox down today?

In the past week alone, The Sandbox gained over 68% as the gaming sector surged. Now, the sector appears to be in a correction phase that began at the start of October.

The trading volume of the sector plunged by 23% in the past 24 hours, reaching $887 million. The market cap of the sector is down by a percent to around $7.50 billion.

For The Sandbox, CoinMarketCap reported that its daily mindshare fell by 14%, which accelerated its drawdown. The number of mentions and engagements reduced by over 2K to around 10.60K in a single day.

Similarly, the altcoin’s market structure was weak in the short term. SAND was trading in a descending trend channel, which could be a bull flag for an uptrend continuation.

Currently, the bears are in control, with the Bull Bear Power (BBP) in red and the altcoin trading above the mid-level of the channel. The next key demand level is around $0.06 if SAND does not breach the upper level.

Worth noting, the selling pressure has greatly reduced, with Net Volume almost flat. Only 3.54 million SAND were sold at press time, compared to a maximum of 46.32 million tokens sold on the second day of this month.

Breaking above the channel puts $0.085 into focus, while a breakdown opens a path to $0.043. The decline could continue as long as the correction phase lasts.

The Catch!

Meanwhile, the huge reduction in selling pressure has resulted from Spot activity. Exchange Reserves which rose sharply from 71 million tokens to 125 million in the first four days of the month, indicate profit-taking has cooled off.

In the past two days, over 17 million SAND have left exchanges, indicating Spot buying as the market retraces.

Further analysis of SAND‘s market participants shows how retailers, whales, and smart money are positioning.

The Long/Short ratio on Binance, OKX, and Bybit for retail trades was 1.12, 1.47, and 1.41, respectively. Whales too had a ratio above 1.31 on Binance and OKX, but their positions were seller-dominated on OKX with a ratio of 0.98.

On the contrary, the Smart Money was bearish across the exchanges. This contributed to almost an equal amount of buy and sell volumes in the Futures market.

Over the past four hours, Long volume accounted for 53.50%, equivalent to $22 million, against $19 million for short orders. Thus, the battle between whales and retail against smart money remains open.

Final Summary

• The Sandbox declined by 10% in the past 24 hours as the Gaming sector entered a correction phase. 
• SAND was trading in a potential bull flag, with Exchange Reserves declining by 17 million tokens in the past two days.