Sui Price Prediction: Will Sui Drop to $2? Bearish EMA Crossover Spells Trouble

However, the price action experienced significant selling pressure at around $3.6 and $4.2.

Today, the price has bounced strongly off yesterday’s lows and trading volumes have surged by 56% as the token broke below a critical support that confirmed a change of character (ChoCh) – a reversal in the trend’s direction from bullish to bearish.

A fairly good number of positive catalysts managed to push Sui to its local high of $4.3.

First, Sui has been embraced by institutional players like Grayscale, an asset management company that recently launched the Sui Trust – an investment vehicle that accredited investors (e.g. institutions and high-net-worth individuals) can use to get exposure to the token.

Moreover, the Sui ecosystem has been growing rapidly. The blockchain’s stablecoin market cap recently surpassed the $1 billion mark while its total value locked (expressed in SUI) has surged by 37% since the year started.

Sui Team Passes Proposal to ‘Hack the Hacker’

A recent incident that affected Cetus, the ecosystem’s leading DEX and liquidity protocol, resulted in the loss of $223 million by users.

The Sui team managed to freeze $162 million worth of SUI that were drained from Cetus and passed a proposal to validators to modify the blockchain’s ledger in a way that these SUI tokens are moved to a multi-sig wallet controlled by the Sui Foundation until the refunds are sent to users.

Modifying the ledger through this kind of governance proposal was criticized by those who support full decentralization rather than centralized governance through entities like the Sui Foundation.

The Cetus hack may have contributed to evaporating some of Sui’s strong gains as it tainted the blockchain’s reputation a bit.

Bear Trap or Former Support Retest?

Today’s strong volumes have pushed SUI’s 24-hour performance from deep red to gains of 2.6%. This was a remarkable recovery considering the significant selling pressure seen across the crypto market yesterday.

The daily chart shows that a bullish engulfing candle has emerged today as a result of these strong overnight gains.

This spike came right after Sui touched the $3 psychological threshold, which is no coincidence. For now, this engulfing candle is invalidating the token’s bearish breakout below its key support level of $3.20 – $3.15.

If the price climbs above this mark, this would qualify as a bear trap. However, the session is not over and the lower time frames are already showing weakness in the price action.

If SUI closes below the $3 level by the end of the day, this would favor a bearish outlook and a potential drop to the $2 level in the next couple of weeks.

The 9-day EMA has already posted a ‘death cross’. The last time this sell signal popped up in the hourly chart, it inflicted a 63% loss to the token.

However, since the price is tagging its 200-day EMA, there is also a good chance that the market draw some liquidity from outstanding buy orders that sat at this level to propel Sui to a higher high.

The next few days will be critical to determine where Sui is heading. A more decisive break of the 200-day EMA would be needed to confirm a bearish outlook. The first support to watch sits at $2.8, after which the next stop could be the $2 mark if that threshold fails to hold.