AI16Z jumps 13% amid whale buys, yet TVL dips to $1.48M – Why?

Key Takeaways 

Why did AI16Z rise by 13%?

The surge in price of AI16Z was driven by whales in the futures market, who bought around the $0.05 to $0.07 levels.

What’s next for AI16Z? 

AI16Z’s weakness could extend as holders were pulling back as the altcoin stayed way below its peak valuation of $2.50.

ai16Z [AI16Z] jumped by more than 13% in the past 24 hours, at press time, emerging in the list of the top trending tokens on CoinMarketCap.

Its daily trading volume also rose by a mere 8%, reaching $80 million.

What drove the short price rally?

 The recent surge in AI16Z’s price was fueled by large whale orders, as indicated by the Futures Average Order Size on CryptoQuant.

Whale activity intensified when AI16Z fell to the $0.0696 range. Notably, a major order placed at $0.0570 just a day ago helped trigger the current market rebound.

Additional whale positions were also added around the $0.639 level, reinforcing upward momentum.

Source: CryptoQuant

Additionally, the Futures Taker CVD showed that the bulls were in control since the start of the month. However, the momentum of the buyers has been weak since mid-August. The metric was neutral a day before this 13% surge.

But can these positive market sentiments continue pushing prices higher?

AI16Z price is still confined in a range!

From a technical standpoint, AI16Z was trading within the range of a large bearish candle formed on the 10th of October. On the 4-hour chart, price action fluctuated between $0.05 and $0.08, with a brief breakout to $0.10 that was quickly rejected.

Despite the ongoing correction, the MACD showed green bars, indicating continued buyer dominance. The recent 13% surge was triggered by a breakout above the descending trendline resistance that began earlier this November.

If AI16Z maintains support above the Fair Value Gap (FVG) near $0.055, current momentum could drive the price back toward the monthly high of $0.10.

Source: TradingView

Alternatively, AI16Z could revisit $0.050, which was the support level for the range. Losing this support would worsen the conditions for AI16Z, but it was still a likely outcome.

These mixed signals emanated from the weakening confidence of holders.

Holders pull back as weekly TVL drops

The number of AI16Z holders fell from 105.42K to 103.98K, as of writing.

This indicated that holders were pulling back, reflecting a loss in confidence. The altcoin had a high of $2.50, which explained the deteriorating conviction for another runner.

Source: CoinMarketCap

Additionally, the Total Value Locked (TVL) hit a weekly low of $1.48 million from a high of $2.24 million during the month’s opening.

This decline indicates that capital is exiting the AI ecosystem, despite recent efforts such as rebranding and re-denominating the total supply for upgrades.

Overall, the altcoin is showing significant weakness compared to its earlier performance. For bullish momentum to resume, the price must break above the current range; otherwise, a breakdown could lead to further losses.