Near Protocol [NEAR] plunged more than 12% in the past 24 hours, wiping all its gains acquired in the previous day.
Bitcoin [BTC] and Ethereum [ETH] are also stagnating at $83.50K and $2.50K, respectively, representing a broader market outlook.
The daily trading volume of NEAR has significantly surpassed $1.58 billion, showing why the token is falling hard. Still, the altcoin is trading above the $5 mark, but will that last?
Behind the sell-off: The forces pushing prices lower
As the market dropped, NEAR bulls were facing a rough time, a day after gaining a similar 12%. One of the whales was fully liquidated on a long position of 500K NEAR tokens, costing over $2.64 million.
The whale is now shorting Zcash [ZEC], hinting at a shifting market sentiment.
Even from a broader perspective, the Spot and Futures taker CVD over the past three months flipped bearish over the past week. This explains why the altcoin has been ranging inside a trend channel.
Moreover, the volume is overheating while the price stagnates, indicating that much of this capital is from bears. In fact, retailers were responsible for this selling capital.
The Spot Retail Activity Through Trading Frequency Surge showed there were too many small investors. This surge in retail activity came after NEAR surpassed $4.50, hinting at buying the top, which is common for small investors.
Is NEAR’s rally coming to an end?
Looking at the market structure, NEAR was trading in a rising trend channel. The gentle inclination of the channel showed that buying pressure had greatly reduced.
Over the past two days, the altcoin has broken key levels to the downside, with the price nearing $4.50. Capital outflows are evident as the CMF fell from 0.15 to -0.06, while Net Volume showed that traders sold over 215K NEAR tokens at press time.
As the price trades below the midpoint of the channel, it increases the odds of losing $4.50 as support. That would put levels below $4 into focus.
Still, the market structure is bullish as bulls are defending the slanting support, which runs from $3.885 to $4.838. Even its Spot ETF inflows are still positive, with a daily net flow of $3.98 million.
As a result, the Bitwise NEAR ETF [NRR] reached a cumulative value of $75.38 million, as per data from SoSoValue. This accounts for 1.16% of the altcoin’s market cap.
Therefore, the daily drawdown of the altcoin might be just a correction that has overstayed.
Final Summary
- Near Protocol plunged by more than 12% after long liquidations and selling on both the Spot and Futures market.
- NEAR was trading in a rising trend channel, a bearish reversal pattern that would be confirmed in case of a breakdown.
