Virtual Protocol, once a high-performing asset, has faced significant challenges as demand continues to drop.
In the past year alone, the asset has plunged by 45%, and the short-term outlook also remains bleak, with a 15% decline recorded in the past 24 hours.
Short-term sentiment appears to be deeply inclined toward the bearish side, making further decline increasingly plausible.
Virtual demand zone
Chart analysis shows that Virtual [VIRTUAL] is now heading to a critical level that will further determine its short-term outlook.
This zone, between $0.78 and $0.68, should ideally act as a demand region for price. However, several factors could influence its effectiveness.
This tendency depends on multiple indicators, one of which is the Accumulation/Distribution (A/D) indicator, often used to determine whether investors are selling or buying.
Source: TradingView
At the time of writing, the A/D indicator continues to fall, suggesting that selling activity outweighs buying pressure.
On the brighter side, the A/D still remains in positive territory, indicating that overall sentiment has not yet fully turned negative.
Investors appear to drive a decisive sell-off into the demand zone on the chart, as many already view this region as a more favorable level to re-enter the market.
However, the A/D reaction once price trades into this zone will be most important. An upward move could signal a rebound, while continued weakness could confirm further downside.
Bad time to be bullish
The likelihood of a VIRTUAL drop remains high, given the current liquidation data.
Information from CoinGlass shows that it is currently more profitable to remain in short positions than long positions under the prevailing market conditions.
Putting this into perspective, for every $9 worth of long positions liquidated, approximately $1,560 in short positions have been closed. This wide disparity highlights the market’s strong bearish tilt.
Source: CoinGlass
In the past 24 hours alone, $7,500 in long positions have been forcefully closed, compared to $1.3 million in short positions.
In addition to liquidations, panic continues to spread across the market, as investors voluntarily close their positions to move funds into more stable assets.
Publication-time data also shows that $13.97 million has been pulled out of the derivatives market, excluding funds that were liquidated.
If liquidation statistics continue to follow this pattern, VIRTUAL may remain on a path toward lower price levels on the chart.
Will spot investors be wrong?
Spot investors have continued to buy VIRTUAL since the beginning of the week. Spot exchange netflow data shows that total purchases of VIRTUAL during this period have reached approximately $1.23 million.
This buying activity during a price drawdown signals a degree of confidence among some market participants.
It also hints that a possible rebound could unfold in the coming days, provided that buying pressure persists.
Source: CoinGlass
For now, sentiment points to a drawdown before any potential recovery. However, investors still need to remain cautious, as selling pressure could intensify further.
Final Thoughts
- VIRTUAL is heading toward a key zone on the chart, which could determine the asset’s next move.
- Liquidation statistics suggest that the market is currently against long investors, with a loss of $1.3 million recorded.
Source: https://ambcrypto.com/virtual-loses-45-in-a-year-can-this-stop-the-bleeding/
