SUI’s Recent Price Decline Endangers $19.7M Whale Investment – Learn the Reasons Behind It
An investor holding Sui (SUI) on the Suilend platform took a significant risk by injecting around $19.7 million into the lending pool and using it as collateral to borrow stablecoins.
This risky position hinges on the condition that the price remains above $4.56 to prevent liquidation, a situation that was almost breached given the prevailing market price at that time.
A potential drop below this critical level triggered the liquidation of the whale’s assets, potentially impacting market sentiment and causing a sudden surge in supply, likely leading to a price dip.
On the flip side, the liquidation of the whale’s position might have stabilized or boosted market confidence.
This incident underscores the delicate equilibrium maintained by large investors in the cryptocurrency market and emphasizes their significant influence on liquidity and price stability.
Price Movement and Projections
The price action of SUI showed significant fluctuations, with long positions dominating the trend. Initially, SUI traded around $4.52 before rising above $5.36, indicating a strong resistance level.
Following this peak, the price saw a sharp decline, dropping back towards the $4.52 mark.
This pattern creates a crucial zone around the ascending trendline, often recognized by traders as a region attracting liquidity.
If the coin maintains its upward trendline after the recent rebound, it could present an attractive buying opportunity. However, caution is advised as breaking below this trendline could push the price towards the $2.84 level, signifying a substantial decrease. These levels are likely to influence the short-term price direction.
This analysis, focusing on potential entry points at lower prices for SUI, is consistent with general market observations and trading strategies commonly seen in volatile crypto markets.
On-chain Analysis for SUI
The total value locked (TVL) reaching $2 billion and a 37% surge in new accounts week-on-week indicate strong network participation despite overall market adjustments.
Positive metrics like these historically suggest a potential price increase for the coin, as heightened adoption could counterbalance prevailing downward pressures.
The influx of new accounts during a market slump implies growing trust and attention towards SUI, potentially shielding it from severe drops and setting the stage for a recovery.
In the past week, NFTs on the SUI blockchain saw a 2.64% increase, while the creation of new coins dropped by 6.7%. This shift signifies a focus on non-fungible tokens despite the ongoing market downturn.
This trend indicates a rising interest in NFTs on the SUI platform, which could stabilize or boost SUI’s price as users and investors engage more with NFT projects.
This move might help shield SUI’s price from broader market fluctuations, provided that NFTs continue to attract interest within the ecosystem.