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Decentraland’s (MANA) notable 70% price surge highlights a significant recovery in the Metaverse sector, igniting interest among investors.
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The increase correlates with a surge in active addresses, with trading volume nearing $2 billion, indicating robust market sentiment.
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“MANA demonstrates bullish signs but faces critical resistance at $0.70, with analysts predicting a potential downturn to $0.61,” noted experts from COINOTAG.
MANA’s impressive 70% price gain showcases a Metaverse revival, with increased activity suggesting a vibrant market. Can it maintain momentum or will it pull back?
Decentraland Active Addresses Surge, Signaling Growing Interest
The recent uptrend in MANA’s price can be attributed to a dramatic rise in its active addresses, indicating enhanced user interaction on the Decentraland blockchain. This is emblematic of a broader rebound in Metaverse tokens, with Decentraland and The Sandbox (SAND) leading the charge.
Active addresses, which track unique users engaging in transactions, have skyrocketed from around 810 on November 20 to nearly 4,000 shortly thereafter, highlighting a strong resurgence of interest. This spike has propelled MANA’s price from $0.40 to an impressive $0.70, the highest level seen since March.
Decentraland Active Addresses. Source: CryptoQuant
After this surge, Santiment reported MANA’s trading volume skyrocketed to $1.57 billion. This volume represents the trading activity and liquidity of the token, essential indicators of market health. A robust trading volume typically signals strong market engagement, while decreased activity could suggest waning interest.
Despite the recent price gains, there are indications that MANA may face turbulence. Analysts warn that the momentum could stall given the recent price peak, hinting at a potential pullback in the near future.
Decentraland Volume. Source: Santiment
MANA Price Prediction: Market Dynamics Indicate Possible Pullback
The bullish rally in MANA’s price may have reached its peak, according to the In/Out of Money Around Price (IOMAP) analysis. This metric is invaluable for assessing the distribution of holders based on their profitability and helps identify support and resistance levels.
When substantial groups of addresses are “out of the money,” implying that these holders bought at higher prices than the current market value, they tend to impose resistance as they may sell to recover losses. In contrast, clusters “in the money” provide support as holders are less inclined to sell at lower prices.
For MANA, about 36.47 million tokens held by addresses at approximately $0.70 are currently “out of the money,” indicating a significant resistance zone as it exceeds the tokens held between $0.61 and $0.68.
Decentraland In/Out of the Money. Source: IntoTheBlock
Consequently, MANA’s price might face a retracement, potentially dropping to $0.61 if selling pressure intensifies. Conversely, should buying activity surpass the prior volume at the $0.70 level, there’s a possibility for MANA to rise further, potentially reaching $0.80 instead.
Conclusion
In summary, while Decentraland’s MANA has shown remarkable resilience with a 70% price increase backed by rising user engagement and trading volume, the immediate future appears critical. Resistance at $0.70 poses a challenge, and on-chain metrics suggest a pullback could be imminent, potentially driving prices down to $0.61 unless strong buying pressure prevails. Investors should stay vigilant as the market dynamics unfold.
