Why does wormhole (W) continue to rise? Key breakthrough points deserve attention!

Wormhole (W)'s sharp rise attracted market attention

Wormhole (W) attracted market attention with its strong rise. According to Binance, the token hit a high of $0.03108 on October 12, before falling back to $0.02907. W's weekly increase reached 94.85%, and its increase in the past 24 hours was as high as 73.72%.

Behind this rise is net inflows of funds into the spot market and increased positions in the derivatives market. However, prices have been blocked from falling back at key resistance levels and the upcoming token unlocking plan have also brought new risks to the market. On October 16, approximately 50.41 million W tokens will be unlocked.

Why did Wormhole rise? Spot buying and leveraged trading are heating up

CoinEdition's analysis on October 12 showed that during the rise period, W's average daily trading volume was approximately US$251.8 million. The spot market recorded a net inflow of US$2.37 million, while the amount of open interest in the futures market rose to US$68.53 million.

Net inflows into the spot market indicate that investors are turning directly to buy the token. The increase in open interest reflects the establishment of more trading positions in the derivatives market. However, these two data alone are not enough to prove that the rise is sustainable.

The actions of large investors are equally eye-catching. According to Pluang's report on October 11, a trader held a position with 5 times leverage at an average price of US$0.014509, which contained 63.41 million W tokens. Unrealized profit on this position has reached approximately $937,000. Subsequently, the trader sold 3.27 million W tokens and began partially cashing in profits.

This operation not only shows the market's strong interest in the uptrend, but also marks the beginning of profit-taking. It should be noted that leveraged trading will accelerate losses when prices fluctuate in the opposite direction.

What will happen if Wormhole breaks through $0.031?

CoinEdition's technical analysis points out that the US$0.0292 - 0.0300 range is an important resistance area. According to Binance data, W broke through that range today and hit a high of US$0.03108, before falling back to US$0.02961. This trend highlights the importance of maintaining stability above the region.

From a technical perspective, the W token has stood on the 20, 50, 100, and 200-cycle exponential moving average (EMA) on the four-hour chart and recovered the Fibonacci retracement level of $0.02644.

If the price can remain above the US$0.0292 - 0.0300 range, the US$0.0310 target price will again become the focus. If there is a downward trend, US$0.02644 will become the first important support level; once it falls, follow-up attention can be paid to the areas of US$0.02355 and US$0.02151.

In addition, the daily Relative Strength Index (RSI) exceeded 75 and the Bollinger Band %B reached 1.20, indicating that despite the current strong momentum, the risk of a short-term correction is rising.

October 16:50 million W tokens will be unlocked soon

According to CoinGecko, Wormhole will unlock 50.41 million W tokens on October 16. This quantity accounts for approximately 0.50% of the total supply. CoinGecko pointed out that at current prices, the value of the unlocked tokens is approximately $1.4 million.

These tokens will be distributed to ecosystems and incubation projects, strategic network participants, core contributors, and the Guardian Nodes community. If some unlocked tokens flow into the market, selling pressure may increase. However, it is not realistic to assume that all tokens are sold immediately.

Wormhole is currently facing two very different signals: strong spot inflows and active trading activity may support price increases; at the same time, high leverage ratios, overbought indicators and upcoming token distributions may also make price movements more volatile.

Wormhole's short-term direction depends on whether it can hold the barrier near $0.030. If this level can be maintained, it will provide impetus for a new round of gains; if it fails, investors need to pay close attention to the support of US$0.02644.

This content is based on general market data and does not constitute investment advice. Readers are advised to conduct independent research.