It has been three weeks since SAND broke out of its wedge pattern with the bears ready to take over. The token just concluded another bearish week by being oversold, before recovering by approximately 38%.
A recap of SAND’s price action reveals that it broke below support at $2.69 on 26 April. This was after entering the narrow price range dictated by support and resistance in its wedge pattern. SAND recently bottomed out at $0.96 on 12 May. This represents a 58% drawdown ever since it dropped below the support line.
At press time, SAND was trading at $1.34 – At a slight premium on its latest local low. The slight rally on 14 and 15 May was underpinned by some accumulation, especially as the alt dove into oversold territory. The same can be evidenced by the findings of the RSI and MFI.
Source: TradingView
SAND’s Directional Movement indicator also highlighted the cryptocurrency’s strong bearish momentum over the last few days. The -DI crossed below the ADX, signifying trend weakness within the oversold zone.
This consequently meant that the conditions were ripe for the bears to regain control.
Will the bulls retain control or give in to the bears?
The cryptocurrency market is still in a state of fear and uncertainty, especially after recent events. It might explain why the current bounce-back is not as strong as expected, given the magnitude of the latest downside. In other words, investors are still waiting to see how the market will behave over the next few days.
As far as on-chain metrics are concerned, SAND’s Supply on Exchanges (as a percentage of total supply) has dropped slightly since 13 May. This observation also aligns with an uptick in whale transaction counts (greater than $100k worth of SAND). The same was a sign of accumulation when SAND dipped into the oversold zone.
Source: Santiment
Its latest price pump coincided with The Sandbox’s announcement on 13 May. The project revealed airdrop plans, as well as a new 2022 roadmap for LAND owners in The Sandbox Metaverse.
This announcement may have contributed to SAND’s buying pressure at its recent lows. However, it might not be enough to weather any additional downward pressure. The latter remains a highly probable outcome if the crypto-market fails to recover from the prevailing FUD.
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