SUI, the native token of the Sui blockchain, has recently faced significant market turbulence, with more than $15 million worth of long positions being liquidated in the past three days. As a result, the price of SUI has dropped to a weekly low of $4.32, reflecting a nearly 5% decline in just 24 hours. This pullback comes after a broader market dip, with the sell-off partially triggered by the “sell-the-news” event following Donald Trump’s inauguration.
Despite these challenges, there are signs that the SUI token could experience a rebound, particularly driven by growing decentralized finance (DeFi) volumes on the network. The next few weeks will be crucial for traders, as SUI navigates this volatile period and seeks to regain momentum.
DeFi Activity Surge on the SUI Blockchain
One of the more positive developments for SUI is its growing presence in the DeFi space. According to DeFiLlama, the SUI blockchain saw its daily DeFi transaction volume surge to an impressive $672 million on January 20th. This marks the second-highest volume in the history of the network, indicating increasing interest in DeFi protocols built on the Sui blockchain.
In addition to this, the market capitalization for stablecoins on the SUI network stands at $421 million, showing a significant increase from $301 million at the start of 2025. Despite this growth, however, the token’s Total Value Locked (TVL) has dipped by nearly 12% from its all-time high earlier this month, raising questions about the short-term sustainability of this momentum.
SUI Price Analysis and Key Levels to Watch
SUI’s price is at a critical juncture, and traders are closely monitoring key technical levels for signs of future price action. The coin recently failed to defend its support at the 0.786 Fibonacci level, which is around $4.56. If this support is not reclaimed, SUI could see further declines toward the next critical support level at $3.48.
However, if buyers step back into the market and defend these levels, it could fuel a rally toward $7.69, setting a new record high for the coin. According to technical indicators like the Chaikin Money Flow (CMF), there are signs that the buying momentum may be exhausting, as the CMF indicates that buyer activity has slowed following a strong surge in the last three weeks.
The Impact of Long Liquidations
One of the major factors weighing on SUI’s price is the recent surge in long liquidations. Data from Coinglass shows that over $15 million worth of long positions have been liquidated in the past few days, creating forced selling that has pressured the price down.
This surge in liquidations coincided with a drop in Open Interest, which fell to $1.56 billion after reaching an all-time high on January 19th. The liquidation heatmap suggests that more long positions could be at risk if the price drops further, but a potential liquidation cluster around the $4.51 mark could turn the tide in favor of bulls.
Interestingly, the funding rates for SUI have also dropped to a weekly low of 0.0066%, suggesting reduced demand for long positions. This decrease could help lower price volatility in the short term and may provide a more stable environment for future price action.
Is There Potential for a Rally?
While the current market conditions for SUI seem uncertain, there are reasons for cautious optimism. The recent surge in DeFi volumes and the fact that whale traders are holding onto their positions could provide the support needed for a potential rally. If the price holds steady above key support levels and long liquidations taper off, SUI could make a strong rebound.
Traders will need to keep an eye on key price levels, especially the $4.51 mark, which could act as a catalyst for a short squeeze and push the price higher. If the bulls can reclaim the $4.56 support and break through resistance levels, the target of $7 could still be within reach.
In conclusion, while SUI faces significant challenges in the short term, the growing DeFi activity, potential for a price pivot, and whale accumulation suggest that the cryptocurrency could make a comeback. With key support and resistance levels in play, the next few weeks could determine whether SUI can rally to $7 or if the bears will continue to dominate.
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