As a seasoned analyst with over two decades of experience in the financial markets under my belt, I have seen more than a few token unlocks that sent prices spiraling downwards. However, Celestia seems to be bucking the trend, at least for now.
On Wednesday, Celestia’s price dipped 6% to hit $4.9, causing its market capitalization to decrease to approximately $1.09 Billion. Although the broader market is rebounding, this significant decline might be driven by negative market sentiment towards the impending token unlock. Will investors hesitate to drive down the TIA price below $5 or are they already factoring in the impact it’s anticipated to have?
Can Celestia Price Hold $5 Line Amid Today’s Massive Token Unlock?
Today marks the day for the token unlock of Celestia’s modular blockchain network, releasing 176 million TIA tokens worth approximately $900 million. Given that such unlocks often increase the supply of an asset substantially, it is possible that the price of Celestia could experience a prolonged decrease due to this added pressure.
Nevertheless, crypto analyst Nemi points out that the real influence of selling pressure might be less intense than expected.
Among the total supply of 176 million TIA, about 92 million remain unstaked, which could theoretically be put up for sale. Conversely, roughly 84 million TIA are currently locked in staking, thereby lessening the immediate urge to sell by around $469 million.
Additionally, data from Celestia Staking shows that approximately 739 million tokens are secured with an annual return of 10.65%. This attractive yield suggests that token holders might prefer to keep their investments staked instead of cashing out.
Currently, in the cryptocurrency market, there’s an observable progression toward a more optimistic perspective among analysts, as they see a rise in long positions and a decrease in bearish bets, which can be noticed through falling financing fees.
Consequently, the impending token release might initially cause market fluctuations. However, the tokens already staked have noticeably decreased the urge to sell, which may help maintain the price above $5 and prevent a significant price drop.
TIA Chart Analysis Signals Major Support Amid Token Unlock
According to a recent tweet from market analyst trader_sam, potential support levels have been identified for Celestia’s price, which span from $4.5 to $5. At present, the TIA price appears to be re-evaluating this lower support level, potentially regaining its bullish momentum in preparation for the next significant increase.
1) The strong base at this level clearly indicates a significant amount of buying interest, potentially triggering an upward trend in the cryptocurrency market. If this level is maintained, traders might be signaling a possible increase towards $6.5, which represents a 32% jump.
Conversely, should the price of Celestia drop beneath its blue support area, the bullish argument would be rendered null, potentially intensifying the market’s selling force.
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2024-10-30 17:06