Worldcoin (WLD) Sees Double-Digit Price Surge, But Futures Traders Remain Skeptical

Worldcoin (WLD) Sees Double-Digit Price Surge, But Futures Traders Remain Skeptical

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Worldcoin (WLD) experienced a significant price hike during the last trading session, yet futures traders remain unconvinced about the sustainability of these gains.

Token Unlock and Market Reaction

Earlier this week, Worldcoin initiated another token unlock, a move that typically triggers notable market reactions. However, this time, the altcoin’s price response was lukewarm. Despite the token unlock, the price movement was insufficient to shift overall trader sentiment positively, particularly in the Futures market.

Worldcoin’s New Unlock Schedule

Tools for Humanity (TFH), the team behind Worldcoin, recently announced a major change to the unlock schedule of its native token, WLD. Initially planned for a three-year period, the unlock timeline has been extended to five years, starting from July 24, 2024. This extension aims to manage market supply and stabilize the token’s price by preventing a sudden influx of tokens.

Market Performance and Fluctuations

Worldcoin’s market performance has been volatile over the past week. Initially, the token was on a downtrend for more than seven days. On July 24, coinciding with the start of the token unlock event, WLD saw a modest 1.32% hike, nudging its price from approximately $2.1 to $2.2. However, the following day, the token’s price declined by over 4%, returning to around $2.1.

A significant positive shift occurred on July 26, with WLD’s price jumping by 11.74% to reach $2.3. This uptrend continued slightly, bringing the price to about $2.4 with an additional increase of over 1%. Despite these gains, the trend has not yet turned bullish.

Technical Analysis and Resistance Levels

Technical analysis indicates that WLD’s short-term moving average still poses immediate resistance at approximately $2.7 to $3. Overcoming these levels is crucial for establishing a more robust bullish trend. Additionally, the Relative Strength Index (RSI), hovering around the neutral line, suggests that the asset is on the cusp of entering bullish territory, contingent on the sustainability of recent positive trends.

Futures Market Sentiment

An analysis of Worldcoin’s trading metrics reveals bearish sentiment among traders, as indicated by the prevailing long/short ratio and funding rate trends. Specifically, the long/short ratio suggests more short positions than long positions, indicating that traders are betting on a decline in the token’s price.

The funding rate for WLD has been trending below zero, with the current rate at approximately -0.058%. A negative funding rate typically means that shorts are paying longs to keep their positions open, which is common in markets where there is a consensus that prices will drop. This condition indicates that sellers are dominating the market, exerting downward pressure on the token’s price.