- The price of SUI rose to new highs on the charts, aided by robust DEX volumes
- It is worth assessing the state of demand here, especially in the context of the potential for profit-taking
The Sui Network has reportedly just noticed a burst of on-chain activity, one that has pushed DEX volumes to record highs. The price action was also extremely volatile this week, with the same hitting a new ATH on the charts.
According to the official X handle, the total registered DEX volume of the Sui network reached a new milestone of 35 billion dollars. This was supported by a burst of daily volume that peaked at $466 million – also a new all-time daily high for the network.
The surge in DEX demand suggested that there was significant demand for the SUI cryptocurrency. This may have contributed to the bullish performance of the past two days.
SUI had adopted a parabolic curve in November and the first week of December. Earlier this week it also seemed to have entered a profit-taking and retracement phase, but things turned out to be different. The mid-week revival of demand fueled a rally that led to a rise to a new ATH. In fact, the altcoin’s price peaked at $4.91, raising hopes that it would soon cross the $5 mark.
Source: TradingView
However, despite the recent upturn, there were expectations of a recovery. This is due to the bearish divergence between the price and the RSI. On the contrary, it is worth pointing out that the recent increase was driven by the return of spot demand.
Assessment of demand for SUI spots and derivatives
There was an inflow worth $13.67 million on Wednesday and an inflow worth about $5.19 million in the last 24 hours. However, this inflow was considerably higher than the inflow in the first week of December.
Source: Glassnode
The recent surge in spot flows and the push for a new ATH was also supported by a token volume increase of $5.15 billion, according to DeFiLlama. This was the second highest volume spike observed in the history of the Sui network.
Source: DeFiLlama
However, despite these observations, SUI’s TVL has continued to decline. In fact, at the time of writing, it recorded figures of $1.64 billion – a likely indication that some holders have recently withdrawn their liquidity.
The falling TVL seemed to be in line with the falling RSI, hinting at the possibility that profit taking was quite high. However, these expectations have increased the risk of liquidations. Especially for short traders who expect the price to retreat.
Finally, SUI’s short liquidations peaked at $5.5 million in the past 24 hours as the price soared higher. This warrants caution for traders, especially those who plan to take highly leveraged positions.
