Sonic (S) Unlikely to Break Through Resistance at $0.80 — Here’s Why

Key Takeaways

• Despite early signs of a rally, Sonic price faced multiple rejections and now trades at $0.51.
• The CMF reading of -0.12 reveals a lack of buying pressure, contributing to recent price stagnation.
• GIOM data shows that 1.22 billion S coins are in unrealized losses near $0.80, creating a strong sell-off.
• RSI has dipped below 50, and S has fallen beneath the 0.236 Fibonacci level — signaling weak support.

Some weeks back, Sonic’s (S) price showed it was ready to rally to the $1 mark. However, after facing several rejections, this anticipated rally did not pass.

Instead, S, formerly known as Fantom (FTM), experienced a decline. As of this writing, Sonic’s price trades at $0.51, still about 50% from jumping toward $1.

In this analysis, CCN explains why the S price might struggle to surge toward the psychological level in the short term.

Sonic Buying Pressure Drops

On the daily chart, the Chaikin Money Flow (CMF) is down to -0.12. The CMF measures the level of buying and selling pressure around an asset.

When the CMF is positive, it indicates buying pressure. A negative reading, on the other hand, indicates rising selling pressure.

Therefore, the current reading indicates that Sonic has yet to attract notable demand to drive the price higher. This lack of buying pressure is one reason the altcoin struggled to break past the $0.60 resistance recently.

Even though Sonic’s price seems to have strong support near $0.45, on-chain data shows significant resistance ahead that could still prevent it from climbing higher.

Major Hurdle Ahead

CCN’s examination of the Global In/Out of Money (GIOM) shows that Sonic could struggle to exceed $0.80. This is due to the volume of coins in unrealized losses at that level.

Typically, the GIOM spots support and resistance by tracking the number of coins in unrealized profits or losses. The higher the number of coins in gains, the stronger the support.

However, if the loss cluster is higher, it represents resistance. As of this writing, about 1.22 billion S coins, accumulated around $0.80, are in the red.

This is higher than those in profits purchased between $0.30 and $0.54. Due to the disparity, Sonic’s price might fail to break the sell wall at the upper resistance level.

Sonic Price Forecast: Decline Incoming

Looking at the Sonic price action from the 4-hour lens, we observed that the Relative Strength Index (RSI) has dropped below the 50.00 neutral line. This drop indicates that the momentum around the S price is bearish.

Besides that, the cryptocurrency’s value has declined below the 0.236 pullback level, indicating weak support. Should this trend remain the same, Sonic’s price could slide to $0.45 support.

The market value might decrease to below $0.40 in a highly bearish case. However, the trend could change if Sonic’s price rises above the 0.236 Fibonacci level with increased buying pressure.

In that scenario, S might breach the $0.60 resistance. If demand for the cryptocurrency increases, it might climb toward $0.75.