Sui (SUI) faces bearish pressure amid correction fears. Key support levels, declining on-chain activity, and bearish sentiment are weighing on its price.

Sui Price Plunge: Bearish Trend and Correction Fears Grip Traders

Sui (SUI) is currently navigating a tricky situation. Bearish trends and correction fears are looming large, leaving traders and investors on edge. Will SUI bounce back, or is a deeper correction on the horizon?

Sui's Recent Price Action: A Cause for Concern?

After a promising climb past the $4 mark, SUI has retraced significantly. It's now hovering around a crucial support zone. Recent data shows SUI opened the week with a bearish slant, dropping over 5% in the last 24 hours to around $2.75. This is a notable pullback from its recent high of $3.51. While it boasts an impressive 255% gain over the past year, its short-term momentum has noticeably waned.

Technical Indicators Flash Mixed Signals

SUI recently broke down from a triangle pattern, triggering a sell-off that's dragged the token back to a support level at $2.78. A failure to hold this level could trigger a steeper drop toward $2.24, aligning with the 23.6% Fibonacci retracement level.

Momentum indicators are also giving mixed signals. The Relative Strength Index (RSI) is nearing oversold territory, which could signal a reversal. However, the Moving Average Convergence Divergence (MACD) remains in bearish territory, showing no clear sign of upward momentum.

Derivatives Market Echoes Bearish Sentiment

Data reveals a significant drop in Open Interest (OI) for SUI, hitting a nearly two-month low of $1.15 billion. This marks a 43% decline from its May peak, indicating capital outflow from the derivatives market. This is further supported by a falling OI-weighted funding rate. The taker buy/sell volume shows short positions dominating (55%) compared to longs (45%), solidifying the bearish sentiment. The long/short ratio at 0.8195 further emphasizes this bias.

Head-and-Shoulders Pattern: A Bearish Omen?

Adding to the woes, a head-and-shoulders pattern has emerged on SUI’s daily chart. According to market analyst NebraskanGooner, this classic reversal setup could push SUI down to the $2.20 region by early July. The $3.00–$3.10 region, previously a support, now acts as a significant resistance barrier.

On-Chain Activity Fades

Daily transaction volumes on the network have plummeted, and daily active accounts have also dropped significantly. This reflects waning interest and suggests the earlier rally may have been fueled by speculation rather than sustained demand. This loss of momentum highlights the difficulty SUI may face in staging a swift recovery.

What's Next for SUI?

All eyes are on the $2.78 support level. A bounce from this area could pave the way for a move back to $3 and possibly the monthly high of $3.55. However, a breakdown followed by a failed retest could lead to a drop to $2.20 or even lower. While some analysts forecast a potential price range of $3.77 to $5.80 by the end of 2025, the near-term outlook remains uncertain.

Until SUI reclaims key resistance levels and network fundamentals stabilize, its short-term outlook will likely remain fragile. Traders should monitor both technical support zones and broader market sentiment closely. So, buckle up, crypto enthusiasts! It's going to be an interesting ride for SUI. Let's see if it can pull a rabbit out of its hat and defy the bearish odds!