The Sui Sui (SUI) on May 8 made a bearish break of the long-term horizontal area, but then it found ground beneath its feet and now it tries to take revenge
The Sui project has been the focus of increased attention in the crypto market lately.
Sui Network is a high-performance Layer1 blockchain designed to serve high-performance decentralized applications.
The operation and security of the network is ensured by the Proof-of-Stake consensus algorithm.
The project got a working main network last week, as well as its own crosschain bridge for liquidity inflows.
In addition, the largest cryptocurrency exchange Binance listed SUI, as well as announced the launch of token farming on Binance Launchpad.
In addition, the largest cryptocurrency exchange Binance listed SUI, as well as announced the launch of token farming on Binance Launchpad.
The optimistic news, however, was offset by the negative.
As BeInCrypto editors said, holders of the asset were dissatisfied with the presented timetable of token issue and distribution, fearing that it would lead to a dilution of the price.
As a result, the token topped the top altcoin losers for the period from April 28 to May 5.
The token is now trying to develop a rebound, but its bullish prospects remain in doubt until the market takes on a number of important barriers.
Sui and the bearish breakout
As the results of technical analysis show, the SUI exchange rate has been declining since May 4 along a downward resistance line.
On May 8, the price rebounded from that line (red dot), which was near the $1.25 horizontal support area at the time.
Then there was a bearish breakout of this area and the pace of the decline accelerated. On the same day, the market marked a low of $1.02.
There was a bounce from here, but the price still remains below this resistance line.
The nearest support is formed by the Fibo level of 0.382 at $0.96.
Fibonacci levels are traditionally considered the most probable springboards for stopping and reversing the price after a significant advance in any one direction.
As expected, at these levels, the market can win back some of the distance traveled and only then resume the movement in the original direction.
In addition, they can determine the limits of the price move. In the meantime, the nearest resistance is around $1.20.
In the meantime, the nearest resistance is around $1.20. It is represented by the aforementioned downward resistance line.
Relief Rally
The shorter 30-minute timeframe explains the current relief rally. Here the Relative Strength Index (RSI) was giving signals of bullish divergence (green line), which preceded the rise in price.
The RSI is a momentum indicator which indicates whether the market is overbought/oversold, depending on whether it is above or below the 50 mark.
Meanwhile, we can talk about bullish divergence when the decline in price is not accompanied by a decrease in momentum.
Such a situation often leads to a sharp increase in the price of the asset. The fact that the RSI is holding above 50 supports the thesis of a relief rally.
The SUI is now trying to make a bullish break of the short-term downside resistance line.
Given the aforementioned RSI signals, there is reason to hope that the breakthrough will succeed. In this case it is possible to rise to the long-term resistance at $1.20.
On the other hand, if SUI fails to close above the resistance line, a fall to the previously mentioned support level of $0.96 is expected.
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