Worldcoin’s digital asset, WLD, has experienced an extended consolidation phase for around eight months, with the last four months demonstrating increased stagnation.
Currently valued at $2.63, WLD remains distant from its peak of $11 reached during the bullish period for Bitcoin (BTC) in March.
Nevertheless, there is growing positivity surrounding WLD’s potential. An influential analyst has proposed the possibility of a breakout towards $4, especially with a 50% surge in trading volume over the last day, bringing WLD close to its previous resistance level of $3.
This significant uptick in both trading activity and price could signify that WLD is on the brink of emerging from its long-lasting stagnation phase, potentially initiating a recovery period.
Could this be the awaited turning point for investors?
Positive Signals Point to Unexplored Opportunities
During a consolidation phase, capital flow typically slows down, balancing the scale between buying and selling actions. Therefore, to activate a breakout, it becomes imperative to increase buying pressure.
Upon examining the daily price chart, WLD displays a clear imbalance, with selling pressure consistently outweighing buying activity, restricting the coin within the $1–$2 range.
One clear indication is from the Relative Strength Index (RSI), which has lingered within the underbought zone, indicating potential upward growth that has not been explored yet.
Bulls seem to be capitalizing on this prospect, evident through the spike in trading volume contributing to an almost 6% surge in prices within the past 24 hours.
While these bullish signs could steer WLD towards the $4 threshold with heightened volatility, they might not be adequate to propel it back to its previous peak.
Achieving such a milestone would necessitate active involvement from major HODLers to sustain the momentum.
Strategic Moves Needed from Large Holders to Rebalance WLD’s Trajectory
Throughout the last month, significant HODLers have mostly engaged in distribution, with only one notable occurrence of substantial WLD withdrawals from exchanges totaling approximately 80 million tokens.
Despite this movement, it did not significantly impact the price, indicating that extreme volatility is hindering WLD’s breakout potential.
A consistent and persistent accumulation strategy may be crucial to counterbalance the prevalent selling pressure.
In the ongoing market scenario, short positions have been prevalent – a strategic choice considering WLD’s current market position.
However, there is a pinch of hope: increased trading volume and speculative interest could set the stage for a potential reversal if the bulls regain control.
The logic is simple: a slight uptick in whale accumulation might disrupt the entrenched short-sellers, thus impeding price escalation.
If buying pressure escalates, it could trigger a short squeeze, compelling short-sellers to close their positions, leading to a temporary yet substantial upward price movement.
Considering the current imbalance between buying and selling pressures, a short squeeze appears to be the most probable trigger to lift WLD out of its stagnation, potentially setting the path for a new peak.
However, this outcome hinges on sustained trading volume and active participation from large holders.