Is SUI poised for a breakout?

The recent upward momentum of SUI has attracted market attention, with the price rebounding from around 2.3 dollars to the current 3.15 dollars over the past half month, an increase of more than 35%. Against the backdrop of a warming overall cryptocurrency market and easing geopolitical pressures, investor interest in this asset is gradually rising. Whether this upward trend can continue to 3.5 or even 4 dollars requires careful observation of multiple variables.

Token unlock exacerbates supply pressure

The rebound in SUI prices coincided with the Sui Foundation releasing 44 million SUI tokens on July 1, amounting to approximately $120 million, further increasing the circulating supply in the market. According to the official plan, this is only part of a long-term release program, with more than 55 million tokens expected to be unlocked each month until before 2030. The pressure of long-term supply expansion may become a hidden concern for price increases.

Currently, the circulating supply of SUI has reached 3.45 billion tokens, accounting for 34.5% of the total supply, which means that there are still over 5.2 billion tokens in a locked state in the market, and the potential release in the future will continue to affect the supply and demand balance.

Derivatives market data reveals risk signals

In addition to the supply issues at the token level, the cooling of the derivatives market has also led to a cautious outlook on short-term price performance. The open interest in SUI futures has declined from a high of $2 billion in May to approximately $1.18 billion currently, indicating a decrease in trading activity and an increase in market wait-and-see sentiment. This trend is typically associated with a decline in investors’ risk appetite, suggesting that some market participants may have begun to reduce their exposure to SUI.

Key technical support level of SUI

On the technical front, $2.30 is seen by most traders as the current line of defense. If the price fails to hold this key support, it may trigger a deeper pullback. If SUI aims to further challenge the target of $3.5 to $4, it not only needs to maintain its position above the current price level but also requires a sustained improvement in overall market sentiment as support.

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Summary

Although the recent rebound in SUI prices reflects a return of market funds and a recovery of sentiment, the uncertainty remains as to whether it can break through the $3.5 - $4 mark in the short term, considering the ongoing token unlocks and the cooling of the derivatives market. Investors need to pay attention to the overall cryptocurrency market conditions and institutional fund movements in order to more accurately grasp the rhythm and risks of SUI’s future trends.