Friday began rather pessimistic. It’s like a “don’t check your portfolio” tag. Along with Bitcoin and ETH, tokens have dropped out of almost every category.
Of course, the metaverse token is no exception and is falling even more. While the top coins fell 2-4% on the last day, the meta / game token is losing 8-12%.
SAND, the third-largest token in this group by market capitalization, fell 11% in just one day. At the same time, the overall weekly decline at the time of analysis is almost 20%.
Will the sand sink deeper?
To answer this question, you need to analyze the state of the token.
HODLer’s average balance topped $ 450,000 in the last week of November, but has since halved to around $ 220,000, according to ITB data.
The sharp drop in the average balance means that market participants are ditching the token. In fact, the order book statistics and transaction data for each party support the above statement.
Thus, if the profit-taking and craze continues, it will be very difficult for SAND to make up for the losses.
Average balance | Source: IntoTheBlock
The sales trend was accompanied by a decrease in the share of active addresses. Compared to a high of 17.4% at the end of November, at the time of analysis, this figure was only 3.4%. Users leaving the ecosystem are not a good sign, especially when the market falls.
In addition, bearish signals are starting to form even on the DAA price divergence chart. This is also a bad sign.
Optimistic pricing table
Despite the unfavorable position of the indicators, the price chart looks quite optimistic. SAND dipped below the 38.2% Fibonacci level earlier this week, but did not fall much. For the past 5 days, the price has remained active above $ 4.6, or 50% Fibonacci. So if this level continues to act as support, SAND may gradually change its trend.
SAND / USDT | Source: TradingView
In addition, ITB data shows that the token is currently negatively correlated with Bitcoin (-0.54 to be precise). Meanwhile, the likelihood of Bitcoin getting back on its feet seems rather grim. Thus, SAND is in a fairly advantageous position.
It will be more or less a matter of time before a buying trend emerges in the SAND market. When this happens, the state of most of the above indicators will improve. Hence, it makes sense to expect SAND to rise to $ 6 or more.