Starknet (STRK) faces huge losses as it follows the market-wide correction phase that shook investor portfolios. The unexpected movement caused the token to fall by nearly 16% causing a whopping $87k wipeout of STRK long positions in the past 24 hours.
The market’s current positioning puts many investors at risk with big losses for the bulls if investor sentiment does not flip bullish in the coming days. With no solid backing for a bull run this week, STRK starts weakly as investors continue to be cautious of the market’s volatility.
Surprise For Investors
Despite the market’s bearishness, STRK bulls pulled a small win in the shape of a localized breakthrough on the $0.3891 resistance level which might translate to big gains in the coming days. However, this can only occur if the token stabilizes above $0.3891 in the short to medium term.
With the token possibly entering a crucial crossover point hinted at by STRK’s relative strength index, a bullish reversal might be around the corner for investors. But this may only come if the market flips on the side of the bulls.
As of writing, Bitcoin, the biggest cryptocurrency in the world, is currently moving in the same zone as well.
The broader financial market’s current bullishness might leak to the crypto market through Bitcoin’s correlation with major finance indices like the S&P 500 and Dow Jones index, both are up a few hundred points in the past 24 hours.
But with investors split between investing or pulling out of the market, it might take a while before STRK experiences a jump in price that will wipe out last week’s losses. For the current losses to be completely reversed, the token needs to attempt a breakthrough on the $0.5083 resistance level.
However, STRK’s current trajectory may only permit a move above the $0.3891 support level. Once the token stabilizes on this support level, STRK bulls might find new strength, targeting $0.4628 in the medium to long term.
New Developments Might Solidify Investor Sentiment
Despite the market’s bearishness, several developments happened that will help investor sentiment remain on the side of Starknet in the long run.
what they doin’ ova there?@strkfarm TVL goes ballistic pic.twitter.com/dMtzvfopiZ
— 0d1n fr33 (@odin_free) October 5, 2024
Since the start of October, several X personalities have noticed that the Starknet total value locked (TVL) has grown significantly. From September 6th’s $128.47k to over $1.05 million today, representing a nearly 700% increase in under a month.
This came in line with Starknet’s initial step in decentralizing the network. In this initial phase, community members can enter two roles: delegators and validators. However, investors should not expect much from the current implementation of decentralization as the timeline for this is not yet defined and will undoubtedly take some time to implement.
Featured image from Medium, chart from TradingView
