Layer-1 blockchain Sui (SUI) is set to unlock 64 million tokens on October 1, representing 2.40% of the total circulating supply. This event has garnered significant interest from investors as the crypto community eagerly anticipates the token release.
SUI To Not Witness Massive Drawdown
Token unlocks are typically associated with high volatility and potential price declines. However, SUI’s price might not experience a massive drawdown. Let’s delve into the reasons behind this.
In the past 30 days, SUI’s price has surged by 115%, primarily due to Grayscale’s decision to launch the SUI Trust. Additionally, the project’s Total Value Locked (TVL) has reached a new all-time high, indicating increased confidence in the altcoin’s potential.
On October 1, the project will unlock 64.19 million tokens, valued at over $100 million. While this supply shock could lead to high volatility, the daily chart’s Bull Bear Power (BBP) indicator, which measures the strength of buyers and sellers, shows that the bulls are currently in control.
Beyond $1.73?
The dominant buying pressure suggests that SUI’s price could potentially rise above $1.73. Moreover, Sui’s trading volume has increased to $862.48 million. Generally, an increase in buying volume pushes a cryptocurrency’s price higher. For this trend to continue, the volume must keep climbing. If the volume decreases while the price rises, the uptrend could weaken, possibly leading to a reversal.
Interestingly, SUI’s price has increased by 5% in the last 24 hours, with trading volume rising by 122% during the same period. This indicates that the token might experience a continued rally.
The altcoin continues to display remarkable strength. However, traders should monitor the $1.90 region closely, as it has historically been a crucial level for SUI’s price. For example, when SUI’s price attempted to reach $2 in February, it faced resistance at $1.90. Currently, the altcoin is approaching this zone again. With the presence of buying pressure, it is likely to breach this resistance level.
Furthermore, the 20-day Exponential Moving Average (EMA) remains above the 50 EMA, suggesting that the bullish setup is still intact, and SUI’s price could continue to appreciate.
If buying pressure helps SUI surpass the $1.90 resistance, the token may rise to $2.10. However, a wave of profit-taking, where traders sell the token after a price increase, could drive its value down to $1.45, overturning the bullish prediction.
