Worldcoin Initiates Token Unlock, But Market Response Is Tepid

Worldcoin initiated yet another token unlock earlier in the week, an episode that often prompts significant market reactions. However, the altcoin's price

output: Worldcoin (WLD) price remained largely unmoved despite a token unlock event commencing on 24 July. This development was largely underwhelming, failing to generate significant buying pressure or shift overall trader sentiment positively.

This lukewarm response stood in stark contrast to the typical market reactions observed during such events, which usually herald substantial price movements.

However, a deeper analysis of on-chain metrics revealed a brewing bearish sentiment among traders, evident in the funding rate and long/short ratio trends. This pessimism appeared to be at odds with the recent price gains.

Worldcoin price stalls after token unlock

After experiencing a downtrend for over a week, Worldcoin (WLD) price experienced a slight uptick on 24 July, coinciding with the beginning of a token unlock event.

However, this increase was tepid, with the token rising by only 1.32% on 24 July, moving from around $2.1 to $2.2. The following day, WLD price encountered a setback, declining by over 4%, bringing it back to $2.1.

Despite these fluctuations, a significant positive shift occurred on 26 July. According to AMBCrypto’s analysis, WLD price increased by 11.74%, reaching the $2.3 level. This uptrend continued slightly, bringing the price to about $2.4, with an additional increase of over 1%.

However, despite these gains, the trend has not yet turned bullish.

Technical analysis further highlighted that its short-term moving average (yellow line) still posed as an immediate resistance at approximately $2.7 to $3. Clearing these levels would be essential for the token to establish a more robust bullish trend.

Additionally, the Relative Strength Index (RSI), hovering around the neutral line, suggested that the asset was on the cusp of entering bullish territory – Contingent on the sustainability of recent positive trends.

WLD traders pessimistic despite price gains

An analysis of Worldcoin (WLD) trading metrics on Coinglass revealed bearish sentiment among traders, as indicated by the prevailing long/short ratio and funding rate trends.

Specifically, the long/short ratio suggested that there have been more short positions than long positions on Worldcoin. In simpler terms, traders are betting on a decline in the token’s price rather than an increase.

This sentiment stood in contrast to the recent price gains, which would typically indicate bullish pressure from traders betting on an increasing price. However, the lack of substantial buying pressure seemed to be impacting the token’s price movement.

Furthermore, the funding rate for WLD has been trending below zero, with the press time rate at approximately -0.058%. A negative funding rate usually indicates 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 seemed to indicate that sellers are dominating the market, exerting downward pressure on the token’s price.

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