Virtuals Protocol (VIRTUAL) Breaks $2 After Brief Setback — Rally Far From Over

Key Takeaways

• VIRTUAL’s price reclaimed $2 with a 15% daily spike, dismissing fears of a deeper correction.
• Indicators show renewed strength, with the CMF indicating accumulation and bullish momentum.
• On-chain data reveals a 400% surge in price-DAA divergence, pointing to rising network activity.
• VIRTUAL could rise above $3, but rejection at $2.24 may send the price back toward $1.44.

Virtuals Protocol (VIRTUAL) surged 15% today, reclaiming the $2 mark after briefly slipping below it last Friday. The dip raised concerns that one of this month’s top-performing altcoins was losing steam.

But today’s bounce, backed by key technical indicators, suggests the rally may be far from over. Here’s why VIRTUAL could be gearing up for another leg higher, rather than heading into a correction.

VIRTUAL Quick Dip Over

Based on the daily chart, VIRTUAL’s price has been forming a U-shaped recovery pattern since its correction ended in April. Following the recent surge, the token appears to be on the verge of breaking past the resistance at $2.22.

This resistance line also serves as the neckline of the cup-like pattern. Amid the formation, the Chaikin Money Flow (CMF) failed to slide below the zero signal line.

Instead, the image below shows how it bounced off it. Typically, the CMF tracks the level of accumulation and distribution around a cryptocurrency.

When the indicator’s rating drops below the signal line, it indicates selling pressure. In that case, the price is likely to fall.

However, in this instance, the rise in the CMF reading indicates increasing buying pressure. If sustained, then VIRTUAL’s price might experience an extended rally toward $3.

Indicators Align With Further Upside

From an on-chain perspective, CCN analyzed the price-Daily Active Addresses (DAA) divergence—a metric that gauges whether network activity is supporting a cryptocurrency’s price movement.

A positive reading indicates rising user engagement and mostly precedes a bullish trend. In contrast, a decline in the metric points to weakening interaction, which can act as a sell signal.

According to Santiment, VIRTUAL’s price DAA divergence has surged nearly 400% over the past week, implying a notable rise in user activity. If this trend holds, the VIRTUAL crypto price rally could gain even more momentum.

VIRTUAL Price Analysis: Higher Highs

Concerning its short-term potential, we evaluated the daily chart again. This time, CCN looked at the Bull Bear Power (BBP).

The BBP compares the strength of bulls (buyers) to bears (sellers).  When the BBP reading is above zero, bulls are dominant.

However, if the indicator is below the zero line, then bears are in control. As shown in the image below, the BBP has consistently flashed green histogram bars of late, signifying bullish dominance.

As long as bears do not take over, VIRTUAL’s price is likely to rise past the $2.81 resistance. Once validated, the cryptocurrency’s market value might climb to $3.38 at the 0.382 Fibonacci level.

On the flip side, failure to breach the resistance at $2.24 could invalidate this thesis. In that scenario, VIRTUAL might slide to $1.44.