- SUI’s price soared to new highs on the charts, aided by robust DEX volumes
- The state of demand is worth assessing here, especially in the context of the potential for profit-taking
Sui network has reportedly just noted a burst of on-chain activity, one that has pushed its DEX volumes to record highs. Its price action has also been extremely volatile this week, with the same hitting a new ATH on the charts.
According to its official X handle, the Sui network’s total recorded DEX volume hit a new milestone of $35 billion. This was backed by a burst of daily volume which peaked at $466 million – Also a new daily historic daily high for the network.
The surge in DEX demand suggested that there was significant demand for the SUI cryptocurrency. This may have contributed to its bullish performance over the last 2 days.
SUI had adopted a parabolic curve in November and the first week of December. It also appeared to have been entering a profit-taking and retracement phase earlier this week, but things turned out to be different. The resurgence of mid-week demand fueled a rally that saw it hike to a new ATH. In fact, the altcoin’s price peaked at $4.91, igniting hope that it could soon cross the $5-mark.
Source: TradingView
However, there were expectations of a retracement despite the recent uptick. This, because of the bearish divergence between the price and the RSI. On the contrary, it’s worth pointing out that the recent surge was driven by the return of spot demand.
Assessing SUI spot and derivatives demand
There were $13.67 million worth of spot inflows on Wednesday and about $5.19 million worth of inflows in the last 24 hours. However, these inflows were significantly higher than inflows seen in the first week of December.
Source: Glassnode
The recent surge in spot flows and push to a new ATH was also backed by a $5.15 billion token volume surge, according to DeFiLlama. This was the second highest volume spike observed in the Sui network’s history.
Source: DeFiLlama
Despite this observations, however, SUI’s TVL has continued to decline. In fact, it recorded figures of $1.64 billion at press time – A probable indication that some holders have been pulling out their liquidity recently.
The declining TVL seemed to be in line with the declining RSI, alluding to the possibility that profit-taking was quite high. These expectations have, however, increased the risk of liquidations. Especially for short traders expecting the price to pull back.
Finally, SUI short liquidations peaked at $5.5 million in the last 24 hours as the price climbed higher. This warrants caution for traders, especially those planning to take up highly leveraged positions.
