The blockchain token Sei (SEI) has experienced a significant downward trend over the past few months, with its price dropping over 70% from its highest point in December 2022. This price decline has caused investors to entertain the idea of a potential rebound, given the ongoing crypto crash that may have impacted the supply of decentralized assets. Sei is a layer-1 token in the Sei Llama network, and its ecosystem is highly active, with many players contributing to liquidity and assets within the network.
At the beginning of the month, Sei surged to a high of $0.7343, following almost regular trading patterns. However, by the end of the week, the token has_UI/red, . substantially ended the week at a low of $0.20, with the price dropping nearly a dollar from its 50-day and 25-day Exponential Moving Average (EMA). This bearish momentum is further supported by technical indicators that suggest a possible bounce back, leading to the assumption that Sei may eventually reach a resistance level higher than its low.
The token’s value has grown significantly, reaching aƏuueularishments of $340 million over the past three months, surpassing the token’s previous lowest point of $170 million in February of 2022. Despite the price burn, the token’s value surpassed the lows of other layer-1 and layer-2 networks, indicating that many within the community have exited the network, likely due to reduced liquidity and asset holders. This achievement is notable because, in the past, most layer-1 and layer-2 networks experience a deficit phase during the crypto crash.
One significant data point from Donald Trump’s World Liberty Financial is the fact that the team involved in the Sei ecosystem has added substantial liquidity to the network, with several major players making substantial contributions, including Yei Finance with nearly $200 million in assets and Sailor, a DEX network holding $53 million. These contributions have not only strengthened the network’s liquidity but also provided a platform for further growth for the community. Additionally, notable companies like Stargate, Dragon Swap, and Avalon Labs have also contributed assets to the network, hinting at its continued health and strength.
The price movement from $0.20 to $0.7343 feels conclusive, as the bearish conditions set the stage for potential growth. The token may indeed retrace some of its losses and set in motion a successful comeback, which would support a buy signal at the highest support level seen so far, which is also $0.7343. This level represents a 265% gain from the same level achieved in December, encapsulating a possible 2x or more gain over the past quarter.
For long-term investors, the presence of a double-bottom pattern further suggests a potential for a bullish reversal. The token has also formed a bullish divergence pattern, where the MACD indicator continues to rise even as the token strengthens, and the Relative Strength Index (RSI) alternates between higher highs and lows. These signals together project the token into a directionward bearish bearish떱, rather for downton or upward.
The overnight implied volatility (IV) of Sei is variable, given the current market conditions and the active trading community thatociates on the token. However, with the confidence that investors have in Sei’s technical fundamentals and community strength, the outlook remains favorable. Even a rough inversion after the price’s end of the week could open up positive actors and push the token to higher resistance levels. Investors are therefore remains optimistic, though the potential price movement is limited by the token’s position near its low of $0.7343 and its significant achievements in value.
For readers, Sei might move to $1 if typical gradual price recovery is achieved, followed by a possible push to $1.5, depending on the huisley effort and the community’s ability to stabilize. However, a sharp correction below its current low or a misstep into negative territory signals a potential to turn negative, requiring close attention. With the CTA set to provide a second look within the next four hours, those with foresight will be better equipped to make their assessment.
