Sui (SUI) Price Dips After Massive Token Unlock
Sui (SUI) is continuing its downward trend from June, trading around $2.71 on Tuesday. The high-performance layer-1 blockchain token has experienced a 15.5% drop in the last 30 days, reflecting a cautious market sentiment amid geopolitical tensions and macroeconomic uncertainty.
The downward trend for Sui could extend from its current price level, particularly due to a massive token unlock event completed on Tuesday. Its micro-environment shows weakness, with technical indicators highlighting a bearish bias.
Sui’s Unlocked Supply Reaches 1.34 Billion Tokens
Sui has completed a substantial linear unlock, with 44 million coins joining the circulating supply. According to Tokenomist, the circulating supply of the Sui Network stands at 3.45 billion coins, representing approximately 34.46% of the total supply.
The token unlock on Tuesday, valued at $120 million, could significantly increase the risk for SUI, potentially extending the 15.5% drop to the support level at $2.30, which was tested on June 23. Since its peak in May at $4.29, Sui has lost 37% of its value, underscoring a lack of conviction among traders.
Despite the massive token unlock event, Sui investors should prepare for more supply shocks in the future, especially with 5.22 billion SUI, or 52.17% of the total supply, still locked.
Technical Outlook: Sui Bears Defend as Futures Open Interest Falls
Interest in Sui has taken a hit, reflecting the prolonged decline in the open interest (OI) of futures contracts, which stands at $1.19 billion, down from $2.05 billion, a peak reached on May 23.
Open interest refers to the value of active futures and options contracts that have not been settled or closed. A persistent decrease indicates a decline in interest in the token, with traders seemingly unconvinced that the upward trend is sustainable.
Sui’s technical outlook leans bearish, with the token currently below the 50-period EMA at $2.82, the 100-period EMA at $2.98, and the 200-period EMA at $3.08 on the 8-hour chart.
The Moving Average Convergence Divergence (MACD) indicator is on the verge of validating a sell signal. Traders might reduce their risk in Sui with the blue MACD line crossing below the red signal line. The presence of red histogram bars below the zero line may indicate bearish momentum.
Still, an immediate reversal from the current price cannot be ruled out and would depend on the sentiment in the broader cryptocurrency market. Additionally, the descending channel, highlighted in the chart, could provide support at the mid-boundary and prevent the potential drop to $2.30.
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