The cryptocurrency market has been buzzing with the recent performance of Virtual Protocol (VIRTUAL). This altcoin surged over 12% to reach $1.31, driven largely by bullish sentiment in the Derivatives market. However, not all signs point toward continued growth, as market dynamics suggest a potential price correction might be on the horizon.
What’s Driving VIRTUAL’s Growth?
According to market data from DeFiLlama, VIRTUAL’s protocol revenues spiked to $234,000 on September 8, marking the highest in two days. This surge in revenue has been a key factor in the cryptocurrency’s recent ascent. Coupled with investor alignment in the Derivatives market, this has further fueled bullish momentum.
Interestingly, the Open Interest Weighted Funding Rate—a critical metric for gauging funding activity in the Derivatives space—proved instrumental. Data from CoinGlass revealed a positive reading of 0.0060%, underscoring strong support from bullish investors.
Spot Investors Signal Caution
Despite this bullish outlook, Spot investors have shown divergence. A significant sell-off was reported, with over $3.79 million worth of VIRTUAL sold across centralized exchanges in the past two days. Notably, $2.7 million of this sell-off occurred within the last 24 hours alone, signaling intensified bearish activity.
Community sentiment has also fallen sharply. As of September 8, investor optimism stood at 94%, but this figure has since dropped to 71%, raising concerns about the sustainability of VIRTUAL’s rally. Declining sentiment could suggest that a retracement is in store.
Key Resistance Levels to Watch
VIRTUAL has encountered resistance around the $1.32 price level, as highlighted by TradingView data. Despite testing this level twice within the last 12 hours, the altcoin faced rejection both times, suggesting strong selling pressure. If sentiment and bearish activity persist, a price correction could occur in the coming days, mirroring prior declines of 12% or more.
However, all hope is not lost for investors. If bulls manage to strengthen their position, VIRTUAL has the potential to surge past the $1.32 barrier and aim for its next key resistance level at $1.48.
Final Thoughts
While VIRTUAL’s recent performance has attracted considerable attention, the market remains divided. With bullish momentum in the Derivatives market clashing with bearish sentiment among Spot investors, the altcoin’s future remains uncertain. Investors should carefully monitor key metrics and sentiment trends before making any investment decisions.
For those looking to stay ahead in cryptocurrency trading, consider tools like TradingView to analyze market data and trends effectively. Remember, the volatile nature of cryptocurrency markets requires thorough research and cautious decision-making.
