Sui recovery has recently encountered a stall just shy of an important descending trendline resistance. However, the bullish outlook for the Layer-1 token remains promising. The Total Value Locked (TVL) in Sui’s Decentralized Finance (DeFi) ecosystem has recently surged past the $2 billion mark, underscoring a growing investor confidence as the token demonstrates signs of recovery.
Currently, the Sui token (SUI) holds steady above the $3.62 level, having briefly surged past $3.70 earlier in the day amid an overall increase in risk appetite across the cryptocurrency market. As the technical structure of Sui remains intact, bullish traders are eyeing a potential price increase of 22%, targeting the key level of $4.43.
The growth of Sui’s DeFi ecosystem is particularly noteworthy. The staking protocol reached $2.29 billion on July 28, before experiencing a correction to approximately $1.91 billion in early August, a shift largely attributed to a broader market downturn. TVL is a critical measure in DeFi, reflecting the total value of all assets held in smart contracts across the chain. Recently, a steady rise from $1.91 billion to an average of $2 billion indicates that investor confidence in the Sui ecosystem is gradually strengthening. This trend may contribute to the increased interest in staking services, which involve locking SUI holdings in smart contracts to earn rewards.
An uptick in the TVL typically leads to a reduced circulating supply, which can alleviate potential selling pressure. In a scenario where demand continues to rise alongside a decrease in available SUI tokens on the open market, the conditions may align for a sustainable price rally.
Retail interest in SUI has remained robust compared to previous months. Recent data from CoinGlass reveals that Sui’s futures Open Interest (OI) has reached an average of $1.98 billion, up from $1.78 billion on August 22. This increase in OI reflects a solid conviction among investors regarding Sui’s potential to achieve and maintain a breakout of 22% above the resistance trendline towards the targeted $4.43.
From a technical perspective, Sui is currently positioned well above significant moving averages, including the 50-day Exponential Moving Average (EMA) at $3.50, the 100-day EMA at $3.44, and the 200-day EMA at $3.29. These moving averages demonstrate a slightly upward trajectory, reinforcing the perception of bullish sentiment. Additionally, a buy signal from the Moving Average Convergence Divergence (MACD) indicator has been consistent since Monday, indicating that bullish momentum is prevailing. Traders are likely to continue increasing their exposure as long as the MACD’s blue line remains above the red signal line.
A decisive breach above the descending trendline on the daily chart could further energize risk-on sentiment, providing an opportunity for Sui prices to potentially extend their uptrend to the next key resistance level at $4.43, which has been previously tested.
However, caution is advised, as early profit-taking among traders may lead to a pullback, bringing the key moving averages—the 50-day EMA at $3.50, the 100-day EMA at $3.44, and the 200-day EMA at $3.29—into play as potential support levels.
