Sui Price Prediction: Trend Line Break Risks Drop to $3

Trading volumes for Sui (SUI) have exploded in the past 24 hours as the price action is flashing some warning signals that point to an imminent drop below $3.

More than $1 billion worth of SUI has exchanged hands during this period. Whenever volumes hit that threshold, traders should pay attention as it confirms the relevance of the latest technical events.

In the case of SUI, the most recent price action has resulted in a move below the 200-day exponential moving average (EMA) and a bearish trend line breakout.

Stablecoin Reserves on Sui – Source: DeFi Llama

On-chain data indicates that interest in the Sui ecosystem has been rapidly dropping. The amount of stablecoins held in this blockchain has dropped from $1.2 billion to $550 million in just 75 days or so, indicating that traders are fleeing to other places.

At a point when altcoin season has officially started, it is a bit worrying that Sui is experiencing this kind of exodus.

In addition, plans to launch an exchange-traded fund (ETF) for this token are a bit stalled, and momentum has now been favoring other altcoins like Solana (SOL) and XRP (XRP), both of which have already gotten their respective spot vehicles listed on regulated exchanges.

Nonetheless, Sui’s total value locked (TVL), expressed in SUI, has hit its yearly high from June 23 once again at around 640 million tokens. This indicates that ecosystem growth is not as stalled as it seems, although the hype has eased a bit.

By removing the impact of price swings from the TVL analysis, we can see that investors are pouring money into the Sui network once again, and that could precede a spike in the token if positive momentum spills over to the price action.

SUI Could Head to $2.7 If Trend Line Break is Confirmed

The daily chart shows a worrying bearish breakout below SUI’s long-dated trend line support that risks a move to $2.7 in the near term.

SUI/USD Daily Price Chart (Coinbase) – Source: TradingView

This bearish move was accompanied by a drop below the 200-day EMA – also a relevant technical event that could result in a much deeper downturn for the token.

Sui’s momentum readings have also turned bearish as the Relative Strength Index (RSI) moved below the mid-line and down the 14-day moving average.

Today, the price action is retesting this lost trend line support from below. If bears win and the price continues to plummet, it would mean that buying interest at $3.25 is just not enough to keep the token afloat.

A deeper drop to $3 would be plausible at this point, followed by a subsequent decline to the $2.7 support if selling pressure increases.

Sui Needs to Do More to Sway Investors

Sui has been pushing forward a security initiative called Security Expansion that consists of strengthening app-level safety through a $10 million fund.

The project aims to tackle the ongoing issues that often taint the crypto market’s reputation, like scams, social engineering schemes, and impersonation, with the help of key partners in its DeFi space.

Making the network safer should contribute to strengthening Sui’s use case, although that won’t translate into price gains immediately.

Looking ahead, even though macroeconomic conditions are favorable for cryptos, Sui’s on-chain metrics show that investors’ interest in the network is deteriorating as reflected by an exodus of stablecoins.

Simply put, other chains may be offering higher APYs than Sui’s decentralized apps at this point. With so many tough competitors out there, especially a revamped version of Ethereum after the Pectra upgrade, the developing team needs to do more than just strengthen the network’s security to get investors excited.