Canton Network will unlock an additional $3.11million worth of tokens in the next 24hours. It could put fresh pressure on a market struggling for support.
This release comes after a $3 million unlock that was completed yesterday. This was then followed by an abrupt price drop, which raised fears that another supply wave could be on the way.
Would another unlock increase sales pressure?
The increase in Circulating supply is one of the metrics that are closely monitored. Even though not every token unlock will result in a sale immediately, traders are often cautious when large numbers of previously blocked tokens come into circulation.
What is the reaction of the institutions to unlocks?
Over the past two weeks, Open Interest on Canton has decreased dramatically. Canton’s Open Interest has dropped dramatically in just the last two days. [CC] The Open Interest dropped 9%, to 25 million dollars.
This decline suggests that the institutional involvement weakened in anticipation of the latest unlock. The Open Interest does not prove that traders have turned negative or reduced their exposure.
Retail selling pressure can still keep prices in check if the demand is not able to absorb additional supply.
What do the charts mean?
As technical indicators pointed towards weakness, the most recent supply increase was announced.
CC has recently broken below the Bearish Flag’s support level around $0.15. A structure like this often signifies a continuation of a trend after consolidation. After the latest attempt at recovery, it was clear that sellers had retained control.
The trend remained weak across the board. The token’s price continued to trade below the key Exponential moving averages (EMAs), indicating that bearish momentum persisted.
The traders who are looking to close positions or create new shorts may resist rallies until buyers take back those levels.
What if CC fell to $0.13 a unit?
Liquidation Heatmap showed that there were several clusters of liquidity below the price. As leveraged positions gather around these zones, they often act as price triggers.
Markets could be pushed towards those pockets of liquidity if selling pressure accelerates after unlocking. They were all closely watching $0.13, which was the key level of support.
It is unclear whether the unlock will trigger another steep decline. CC may be at risk in the short term due to a weakening Open Interest and a technical structure that is bearish.
Final Summary
- Canton Network will face another $3.11M in tokens after yesterday’s release. The price of the tokens dropped sharply.
- CC’s Open Interest dropped 9%. This suggests traders decreased exposure before the latest increase in supply.
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Source: ambcrypto.com
