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TOWNS crypto has experienced a staggering 50% drop within just 48 hours, plummeting from $0.08 to $0.035 by the end of that period. Such a drastic decline is unprecedented and warrants an in-depth examination of the factors contributing to this significant downturn.
A closer inspection reveals that whales and retail investors were both aggressively selling TOWNS tokens. Whale addresses, specifically, began offloading their positions after the asset reached its all-time high of $0.08. According to data from Nansen, these large-scale holders increased their exchange balances by a massive 2.6 billion percent within a single day. Conversely, withdrawals stood at just 8 million. This sudden shift in whale behavior clearly indicates that these significant players were positioning themselves to exit the market amid rising prices.
The subsequent sell-off was not limited to whales alone; retail investors also contributed to the sharp decline by selling their holdings on the spot market. Coinalyze data suggests a cumulative Sell Volume of over 2 billion tokens across Binance and Coinbase on August 5th and 6th, resulting in a net Buy/Sell Delta that came in at negative figures.
It is noteworthy that these trends have had a profound impact on sentiment, leading to a bearish outlook for TOWNS. The Long/Short Ratio has dipped to an alarming 0.88, with shorts dominating the market at an unprecedented level of 53%. Furthermore, funding rates continued to exhibit a consistently negative trend, signaling a reluctance among traders to hold long positions.
Given this stark reality, it is more likely that TOWNS will continue to experience significant losses if current selling momentum persists. This would inevitably lead to further price drops, potentially as low as $0.034 in the near future.
However, an alternative scenario presents itself should investor sentiment shift and buyers begin to step in. In this context, TOWNS could potentially recover and regain some of its lost ground, reaching a new high of $0.046 if circumstances permit.
Source: ambcrypto.com
