SUI is ‘overbought now’. When should we expect a drop?

The Key Takeaways

SUI’s breakout was backed by whales, pushing it above $3.60. However, $6.49M worth of new money indicated that investors were taking profits. Profit-taking was evident in the $6.49M of new money that came into SUI. Futures traders remained bullish as RSI reached 72.7, even though SUI moved into the zone of supply.

Sui [SUI] It has broken out of the price-constricting triangle that has existed since early 2024. 

Recent price movement past $3.60 coincided with a 128% increase, pushing the price to the Fibonacci level of 0.7886. This breakout indicates a possible reversal as well as growing bullish confidence. 

SUI is currently trading near the historical supply zone at $4. The breakout appears to be fundamentally supported by both spot and derivatives indicator confirmation. 

However, to know if momentum will be maintained, traders need to evaluate activity on the chain and resistance levels.

What is driving this breakout of whales?

SUI’s breakout occurred at the same time as a significant increase in average order sizes for spot, which was flagged. “Big Whale Orders.” The move is driven by large players, not retail traders.

When institutions are accumulating at levels of breakout, rally tends to be longer lasting and less susceptible to immediate reversal. 

This large number of orders appears to be consistent throughout multiple sessions. It suggests strategic accumulation as opposed to short-term speculation. 

The involvement of whales at this time may be a good foundation for bullish markets to continue if the other market factors are in favor.

Source: CryptoQuant

There is a short-term pressure to sell.

SUI reported a $6.49m positive netflow as of the time of publication. This indicates that tokens have been moving to exchanges faster than ever before. 

It was a marked change from the previous consistent outflows, and it could be interpreted as a sign that investors were preparing for reinvestment after the breakout.

Net inflows may not translate directly into selling positions, but they do indicate a greater willingness to liquidate. 

Trading should therefore be closely monitored to see if the inflow trend continues, as it could weaken short-term prices or trigger a brief phase of consolidation.

CoinGlass

What is the reason for high demand in Futures contracts?

Although spot volumes are showing signs of cooling down, Futures markets continue to show strong buy-side activity. 

The 90-day CVD Trend confirmed an aggressive taker purchase volume.

The Funding rate remained at 0.0089% reflecting bullish sentiments and a willingness to take long positions. 

Even though spot traders appear cautious, the futures market still favors an upward continuation. The rally might accelerate if the spot market resumes its activity in line with futures traders’ excitement.

Source: CryptoQuant

Concern?

Technically, SUI has entered a crucial supply zone between $3.83 and $4.05—an area where past rallies stalled. 

The daily RSI is 72.70 which confirms that this asset has now entered overbought land. Moreover, the price trades close to upper Bollinger Band which acts often as dynamic support. 

This suggests that the rally may temporarily slow down or be consolidated. If bulls can turn this zone of supply into support then further gains are possible, and $4.80 is the next Fibonacci target.

TradingView

The breakout of SUI appears to be well supported by the whales and Futures bullish sentiment. However, sudden exchange flows and overbought levels may slow down its momentum. 

If buyers flip the supply zone into support while maintaining positive funding and accumulation trends, a sustained rally—potentially targeting $4.80—remains likely.