SNX, the native token of the Ethereum-based decentralized perpetual futures protocol Synthetix, has defied at the moment’s broader market downturn to emerge because the top-performing altcoin. Its worth has surged by 24% over the previous 24 hours amid renewed demand.
The surge follows rising anticipation for the launch of Synthetix’s new perpetuals change on Ethereum and a buying and selling competitors scheduled for October 20. Nonetheless, on-chain and technical indicators recommend that the momentum is probably not sustainable within the quick time period.
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SNX Momentum Builds Forward of $1 Million Contest, however Bearish Bets Sign Warning
Forward of launching the primary perpetuals DEX on the Ethereum mainnet, scheduled for later this quarter, Synthetix has introduced a well-timed buying and selling competitors on October 20, with a $1 million prize for the highest winner.
Fueled by the rising hype across the upcoming occasion and the protocol’s imminent change launch, Synthetix’s native token, SNX, has seen a surge in buying and selling exercise, sending its worth hovering. Buying and selling at $2.11 at press time, the altcoin has climbed 22% since Sunday.
Nonetheless, on-chain and technical indicators recommend that this momentum might not final.
Information from Coinglass exhibits that SNX’s lengthy/quick ratio has remained flat under one since September 22, indicating that bearish positioning persists regardless of the sharp worth upswing.
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The lengthy/quick ratio compares the variety of merchants holding lengthy positions in opposition to these holding shorts. A studying under one, as seen with SNX, displays a market with bearish expectations.
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Its persistent flatness suggests that the majority merchants are nonetheless betting in opposition to the token, with no bullish shift in sentiment even because the SNX worth climbs. This hints on the chance of a pullback within the close to time period.
In the meantime, the Relative Energy Index (RSI) exhibits SNX has entered overbought territory, signaling that the token could also be due for a cooldown. As of this writing, the important thing momentum indicator sits at 72.62.
The RSI indicator measures an asset’s overbought and oversold market situations. It ranges between 0 and 100. Values above 70 recommend that the asset is overbought and due for a worth decline, whereas values below 30 point out that the asset is oversold and should witness a rebound.
SNX’s present RSI studying indicators that the altcoin is overextended and will face a short-term correction.
$2.58 Breakout or $1.77 Retest?
If momentum stalls and merchants start taking income, SNX may retrace a few of its beneficial properties within the coming classes. In that state of affairs, its worth may fall towards $1.778.
Conversely, if renewed shopping for stress is sustained, because the buying and selling competitors nears, the token may consolidate at larger ranges. It may breach the resistance at $2.131 and cost in the direction of $2.580.