THORChain [RUNE] Rallies 15.64% as Bulls Gain Control of the Market

THORChain [RUNE] rallied 15.64% in the past 24 hours as bulls gain control of the market. However, it remains unclear whether the altcoin can maintain its 70% gain

As mentioned in the previous analysis, THORChain [RUNE] was approaching a critical level of resistance. This level, around $2.93, had been closely followed throughout May. At this level, a cluster of selling orders could exert downward pressure on the altcoin, potentially leading to a decline toward the $1.768 support.

However, if bullish momentum persists, a clean break above $2.93 could open the gates for RUNE to rally toward $4.14. This level marked the last major top before February’s sell-off.

Now, despite the recent recovery of over 70% from the January lows, a key factor that could hinder RUNE's further ascent is the presence of strong selling activity by spot traders.

CoinGlass data revealed a Net Outflow of $1.68 million on the 22nd of May, indicating potential profit-taking or hedging behavior by spot traders.

This selling activity could exert downward pressure on RUNE, setting the stage for a potential return toward the $1.70 level, where another cluster of liquidity could trigger a rebound.

Nevertheless, if this selling activity is part of a broader correction from the February highs, then further downside cannot be ruled out.

Can derivatives momentum keep RUNE afloat?

Looking at the derivatives market, key metrics such as Open Interest and the Long/Short Ratio have so far supported the potential for continued upside for RUNE.

Open Interest, which measures the total value of unsettled derivative contracts, surged by 18.65% in the past 24 hours to reach $86.57 million.

While this metric alone does not confirm a bullish or bearish trend, it reflects a build-up in market activity, which is usually associated with sustained price movements.

Moreover, the Long/Short Ratio, which measures the ratio of traders who are betting on the price to go up versus those betting on the price to go down, climbed to 1.105. This reading suggests that, at present, there are more traders who believe RUNE will continue rising.

This long-heavy bias could keep the token afloat, at least until the derivatives market shifts in favor of bears.

What does the Liquidation Heatmap show?

Finally, to gain further insight into the token's price movements, AMBCrypto analyzed the Liquidation Heatmap.

This map highlights clusters of unsettled orders using various colored zones (excluding black), which act as magnets that attract price movement.

As highlighted in the previous analysis, more liquidity clusters appeared below the current price, especially near $1.70. This suggests that a downward move in this direction could trigger widespread liquidations, setting the stage for a bounce.

However, if the price moves higher instead, RUNE will encounter a key resistance at approximately $2.30, which aligns with existing chart levels, before another possible decline.