- Worldcoin (WLD) has exhibited a bearish trend on higher timeframes, despite an impressive near 90% price rebound.
- The recent rally draws parallels to a similar occurrence in February 2024, where a substantial retracement preceded a significant upward movement.
- “Worldcoin’s price bounce of 89% from the recent low at $1.72 caused extensive short liquidations, and a further squeeze remains plausible,” observed a financial analyst.
An expert analysis of Worldcoin’s (WLD) recent price surge, market dynamics, and future outlook. Discover how history might repeat itself and what to expect next.
Worldcoin’s Remarkable Rebound: What Sparked the 89% Price Increase?
Worldcoin (WLD) recently experienced a significant price surge, rebounding by nearly 90% from its low of $1.72. This sudden uptrend led to a considerable amount of short liquidations, catching many traders off guard. The short squeeze reflects heightened market volatility and raises questions about the sustainability of WLD’s current price levels.
Impact of Token Unlocks on Market Supply
Upcoming token unlocks for early investors and team members, scheduled to commence on July 24th, are anticipated to introduce a new wave of supply into the market. The critical question remains whether the demand can effectively absorb this increased supply, especially with the token’s historical bearish trend on higher timeframes.
Technical Analysis: Resistance Levels and Market Sentiment
Despite the significant price rally, WLD’s recent performance has hit a resistance at the $3 zone and struggled to clear the lower high of $3.2. This has heightened market skepticism regarding the continuation of the bullish trend. Key resistance levels at $4.5 and further Fibonacci retracement levels at $5.7 and $5.5 will be crucial in determining the next phase of WLD’s price movement.
Indicators and Momentum: RSI, CMF, and Trading Volume
The daily Relative Strength Index (RSI) surpassed the neutral 50 mark, indicating strong bullish momentum. However, the Chaikin Money Flow (CMF) remains slightly negative at -0.06, suggesting lingering skepticism among investors. While trading volumes have increased over the last four days, consistent buying pressure is essential to solidify a bullish trend reversal.
Short-Term Bullish Sentiment: Can It Sustain?
Recent market data reveals that the sharp price bounce has significantly impacted traders, leading to a rise in short liquidations and a temporary bullish outlook in the short term. However, this optimism has begun to recede, as evidenced by the increase in long liquidations following the rejection at the $3 level. Consequently, market sentiment is cooling, and traders remain cautious.
Future Projections and Potential Downtrend
Despite the recent uptrend, Worldcoin’s bearish outlook on higher timeframes suggests a likely continuation of its downtrend. Key resistance zones near $4.5 could act as strong barriers, potentially halting any future bullish attempts. Therefore, while short-term gains are possible, the overall long-term view remains bearish.
Conclusion
In summary, Worldcoin’s recent price rebound has injected some short-term enthusiasm within the market, yet significant resistance levels remain a considerable challenge. As token unlocks approach, the balance between supply and demand will be paramount in dictating WLD’s future course. Traders should remain vigilant and consider both technical indicators and market sentiment in their strategies.
