Traders Watch for SNX Breakout as DeFi Hope Rises

The cryptocurrency market is closely monitoring Synthetix (SNX) as it approaches a critical resistance level, with traders and analysts observing a potential rounding bottom formation that may signal a shift in price momentum. The asset has recently shown signs of consolidation after a prolonged bearish trend, with on-chain metrics and price action suggesting a possible reversal. This development comes amid broader market optimism in the decentralized finance (DeFi) sector, which has seen renewed interest in tokenized synthetic assets and decentralized derivatives platforms.

Technical analysis of SNX's recent price movements indicates that the token is currently testing a key resistance level around the $0.35 mark. A successful breakout from this level could trigger a significant rally, potentially pushing the price toward the $0.50–$0.60 range, based on historical support and resistance patterns. Analysts have noted that the rounding bottom pattern, also known as a "cup and handle" formation, typically precedes a bullish trend following a period of sideways trading. This pattern has been observed in several other altcoins prior to notable price surges, adding to the speculative interest in SNX’s near-term trajectory.

On-chain activity also reflects increased accumulation of SNX tokens by long-term holders, with a noticeable rise in wallet concentration over the past six weeks. This trend has been interpreted by some as a sign of growing confidence in the token’s underlying value proposition. The Synthetix protocol, which enables users to mint and trade synthetic assets, has seen a modest increase in daily active users and trading volume in recent weeks. While these figures remain below all-time highs, they indicate a gradual return of liquidity and user participation in the ecosystem.

In addition to on-chain metrics, sentiment indicators such as the Fear & Greed Index have shown a slight shift toward optimism in the broader crypto market, which could bode well for SNX. However, traders are advised to remain cautious, as the broader market environment remains volatile and subject to macroeconomic factors such as interest rate policies and regulatory developments. The token’s performance is also closely tied to the broader health of the Ethereum network, which continues to face congestion and high gas fees during peak transaction times.

Looking ahead, market participants are closely watching the 200-day moving average as a potential support level that could either reinforce the rounding bottom formation or lead to further consolidation. According to several market analysts, a sustained close above $0.35 would be a key confirmation of the pattern’s validity and could attract additional inflows from both retail and institutional investors. Nonetheless, any short-term volatility is expected to persist until the broader market stabilizes and macroeconomic uncertainties are resolved.