Will Monad's 29% Price Rally Hold Amid Weak Capital Flow and Derivative Signals?

The recent 29% price rally in Monad (MONAD) has sparked debate among traders and analysts, with conflicting signals emerging from technical, on-chain, and derivative market data. As of November 2025, the token's trajectory appears to hinge on its ability to break through key resistance levels while navigating structural challenges in capital flow and speculative positioning. This analysis synthesizes short-term technical and on-chain insights to evaluate the sustainability of MONAD's upward momentum.

Technical Analysis: A Mixed Bag of Signals

Monad's technical indicators present a nuanced picture. The 14-day RSI of 42.71 suggests a neutral stance, while the 1-hour RSI of 55 hints at immediate bullish sentiment. However, the Stochastic Oscillator and Commodity Channel Index (CCI) signal sell pressure, creating a tug-of-war between short-term optimism and longer-term caution.

Moving averages further complicate the outlook. The 8 SMA and 13 SMA have surged by over 3%, indicating robust short-term momentum, but the 55 SMA looms as a critical resistance level. Pivot points clustered around $0.03 to $0.04 underscore the strategic importance of this price range for traders. Meanwhile, the 7-day RSI of 43 suggests the asset is nearing oversold territory, a potential catalyst for a rebound-if buyers step in.

Candlestick patterns from November 10–11 reveal volatility, with a $0.54717 high collapsing to $0.51215 within 24 hours. This erratic behavior highlights the fragility of the rally, as consolidation phases often precede decisive breakouts or breakdowns.

On-Chain Activity: Growth Amid Structural Risks

On-chain data paints a more bullish narrative. Nansen reports a 59% surge in active wallets and 14.5 million transactions in the past week, signaling organic adoption. Smart money inflows of $1.2 million over 30 days and a 529,928-wallet surge suggest growing institutional and retail confidence.

However, structural risks persist. The mainnet launch on November 24, 2025, inflated MONAD's fully diluted valuation to $3.2 billion, driven by a minuscule float of 10.8 billion tokens out of 100 billion as reported by Klever. This low-float dynamic distorts FDV as a metric, creating a false sense of demand. Additionally, airdrop participants dumping tokens post-unlock and fake transactions have exacerbated sell pressure, countering the positive on-chain narrative.

Derivative Markets: A Double-Edged Sword

Derivative metrics reveal a high-stakes game of cat and mouse. The long/short ratio for MONAD is nearly balanced at 50.03% long and 49.97% short according to CoinPerps, but exchange-specific data tells a different story. Binance's 1.0435 ratio and OKX's 1.0128 suggest mild bullish bias, while KuCoin's 1.1098 hints at stronger speculative positioning.

Open interest and liquidation data amplify the volatility. Following the mainnet launch, open interest surged to $178 million, with derivatives volume hitting $2.65 billion. A whale's $5.14 million long position and $78 million in 24-hour liquidations underscore the fragility of leveraged bets. The RSI peaking at 84 and Sequential Pattern Strength at 107 signal an overbought condition, raising the risk of a liquidation cascade.

The Verdict: A Rally on a Precarious Foundation

Monad's 29% rally is underpinned by strong on-chain adoption and short-term technical momentum but faces headwinds from derivative market fragility and structural tokenomics. The token's ability to clear the $0.03–$0.04 resistance cluster will be pivotal. A successful breakout could validate the bullish case, but a breakdown risks triggering a cascade of forced liquidations and renewed bearish sentiment.

For now, traders should monitor the 55 SMA as a key psychological barrier and watch for shifts in the long/short ratio. While the on-chain fundamentals are encouraging, the derivative market's overbought state and airdrop-related selling pressure suggest caution. In a market where liquidity is thin and risk appetite is low as reported by Klever, MONAD's rally may prove ephemeral unless it can sustain momentum beyond its consolidation phase.