Investor interest in SUI is fading away after fall from ATH

Sui has been navigating a highly volatile market over the past month, with recent movements intensifying negative sentiment surrounding the asset. On October 14, Sui reached an all-time high of $2.36, coinciding with a significant bullish momentum in the cryptocurrency market. This upward trend was bolstered by several key factors, including the launch of MLS Quest, a non-fungible token (NFT) platform themed around Major League Soccer. This initiative was developed in partnership with Sweet, a blockchain startup known for its gamified approach, which initially generated a wave of positive sentiment in the community.

Another important driver of Sui’s earlier success was the launch of USD Coin on Sui’s mainnet, which further validated its ecosystem and contributed to a sense of optimism among investors. However, this bullish sentiment proved to be short-lived. Just two weeks after hitting its peak, Sui’s positive momentum began to fade as the broader cryptocurrency market faced a significant correction, leading to a sharp decline in investor confidence.

The shift in sentiment became evident through data provided by Santiment, which tracks social media sentiment surrounding cryptocurrencies. The weighted sentiment for Sui dropped dramatically from 0.06 to -0.06 in a matter of days. Such a decline typically indicates a rise in fear, uncertainty, and doubt—commonly referred to as FUD—among investors, which often leads to further downward pressure on the asset’s price.

Additionally, there has been a notable decrease in market interest, as evidenced by the total open interest in Sui’s perpetual contracts. This figure plummeted from $895 million on October 7, when the market-wide bullish trend was at its peak, to just $330 million at the time of reporting. This decline marks a two-month low for SUI’s open interest, reflecting a growing reluctance among traders to maintain positions in the face of increasing negativity.

Despite the prevailing negative sentiment, there are some signs of resilience. SUI’s funding rate shifted from -0.002% to 0.01% as its price managed to surpass the $1.95 mark earlier today. Currently, SUI is trading at $1.88, which represents a modest increase of 0.3% over the past 24 hours. The asset remains the 18th-largest cryptocurrency by market capitalization, valued at approximately $5.3 billion. Moreover, SUI has seen a significant increase in daily trading volume, which rose by 30%, reaching $630 million.

However, the outlook for SUI remains cautious. If the asset continues to face downward pressure, the potential for long liquidations could create panic among investors, leading to a selloff that further exacerbates the negative sentiment. As the market adjusts to these developments, the sentiment surrounding Sui will likely remain a crucial factor influencing its price trajectory in the near term.