The bulls of Wormhole [W] displayed urgency in pushing prices above the $0.4 mark. The resistance level at $0.278, which had persisted for over a month, was surpassed and then tested as a new support level. Trading volume witnessed a significant surge compared to the previous week.
This development has provided encouragement to traders and holders, hinting at the potential for further gains in the upcoming weeks, with the next hurdle being the $0.52 resistance level.
Breaking the Weekly Structure of Wormhole Crypto
The recent weekly chart for Wormhole had a lower high at the $0.2785 level, indicating a downtrend. The breakout above this level signaled a bullish shift in the weekly market structure, with a similar pattern observed on the daily chart.
After being retested as a support level in the past few days, Wormhole crypto experienced a substantial surge in price. Recording a growth of over 40% within 24 hours, there is a possibility of further upward movement.
The bearish order block in the range of $0.36-$0.38 was close to being breached. Swing traders may consider booking profits in this range and wait for consolidation near or above the resistance level before considering re-entering a long position.
The On-Balance Volume (OBV) indicated strong demand for W, while the Directional Movement Index (DMI) highlighted a robust uptrend on the daily chart. Retesting the resistance from July suggested that taking profits, even partially, could be a wise move for traders.
Short-Term Sentiment Soars to the Stars
The Open Interest was reported at $44 million the previous day, which subsequently surged by nearly 50% to reach $64.8 million, underlining a strong bullish sentiment. Buyers demonstrated eagerness to initiate long positions, which was also evident in the spot market.
Although the funding rate declined in the recent hours, it started to rise again, suggesting an increasing number of participants are inclined towards maintaining long positions. Both the price action and futures data indicated a potential move towards $0.4.
It remains to be seen whether the upward momentum will persist or if the bulls might require a brief period of consolidation.
Disclaimer: The views expressed are not intended as financial, investment, or trading advice and solely represent the writer’s perspective.