Following the optimistic progress, The Sandbox (SAND) reached a new high for the year, hitting $0.86 during early Asian trading on Monday. However, the price subsequently adjusted down by 14%, currently trading at $0.76 at the time of writing.
Despite the recent price surge, technical and on-chain indicators suggest that the long-anticipated $1 target remains unfeasible. Here's why.
Long-Term Investors of The Sandbox Benefit
The increase in SAND price over the past week has prompted long-term investors to move their previously inactive tokens. This is reflected in the increase in the token's consumed age metric, which measures the movement activity of coins held for a long time. According to Santiment, this metric has surged to a two-month high of 33.19 billion on Sunday.
The prominence of this metric is noteworthy, as long-term investors typically do not move their coins. Therefore, when they take this action, especially during price increases, it suggests a shift in market trends. Significant spikes in consumed age during such price surges indicate that long-term investors are selling, which could lead to increased selling pressure.
SAND Age Consumed. Source: Santiment
Notably, the increase in SAND flow balance on exchanges over the past 24 hours confirms selling activity. According to Santiment, this metric, measuring the difference between the amount of assets deposited into exchanges and the amount withdrawn over a specific period, has increased by 162%.
This reflects an increase in the amount of SAND tokens being sent to exchanges. It indicates that investors are preparing to sell, potentially leading to downward pressure.
SAND Exchange Flow Balance. Source: Santiment
SAND Price Forecast: Metaverse Token Is Overbought
On the daily chart, SAND's Relative Strength Index (RSI) stands at 87.18, indicating overbought conditions. RSI measures whether an asset is overbought or oversold, ranging from 0 to 100. Values above 70 indicate that the asset is overbought and may decline, while values below 30 suggest it is oversold and may recover.
With the RSI at 87.18, SAND is suggesting overbought conditions, creating short-term correction risks. If the price drops, it could fall to $0.72. Increased selling pressure at this level could push SAND further down to $0.61, moving it further away from the established $1 target.
SAND Price Analysis. Source: TradingView
Conversely, the price of SAND Token could recover its five-month high to $0.86 if selling pressure decreases. This would negate the bearish hypothesis mentioned above.
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