SUI -26.74% Amid Market Volatility and Technical Reversal Signs

SUI has experienced a sharp decline in the last 24 hours, with the token dropping 13.27% to settle at $3.3494 on SEP 2 2025. Over the past week, the token has seen a steep correction of 512.42%, following a 193.88% increase over the prior month. Despite a robust monthly gain, the yearly performance remains negative, with a cumulative decline of 1965.07%.

The recent downward movement is part of a broader bearish pattern that has emerged following a multi-week rally. Analysts note that the token appears to be struggling to re-establish control above key resistance levels, with the 200-day moving average currently acting as a significant psychological and technical threshold. Price action has shown a clear breakdown from a previous consolidation range, suggesting increased bearish momentum.

Technical indicators such as the Relative Strength Index (RSI) and Moving Average Convergence Divergence (MACD) have shifted into bearish territory. The RSI has fallen below 30, signaling oversold conditions, while the MACD histogram has turned negative, reinforcing the bearish sentiment. These readings suggest that the current pullback is not merely a correction but a potential reversal in the medium-term trend.

The market environment has also contributed to the increased volatility, with heightened liquidity shifts and algorithmic trading activity observed in recent candle formations. Traders have been quick to respond to these signals, with a noticeable increase in short positions opening as bearish indicators continue to align.

Backtest Hypothesis

To test the sustainability of the current bearish scenario, a backtesting strategy has been proposed based on the recent technical setup. The strategy involves entering short positions when the RSI falls below 30 and the MACD histogram turns negative, with a stop-loss placed just above the nearest psychological resistance level. Profit targets are set at the next major support level or based on a fixed risk-to-reward ratio of 1:2.

The hypothesis assumes that the current technical environment represents a reliable sell signal, particularly given the confluence of multiple bearish indicators and the absence of significant bullish catalysts in the immediate outlook. Traders utilizing this strategy would look to capitalize on the oversold condition while mitigating risk through defined exits.