- Worldcoin was oversold until July 1, when the price started to rise
- Sentiment around the token improved, suggesting demand could be better
The past 90 days have been turbulent for Worldcoin [WLD], the token linked to the digital identity application. At the time of writing, WLD was valued at $2.52.
This price indicated a decline of 64.90% in the past three months. It also represented the lowest value the token had reached since November 2023. Worldcoin’s depreciation could be related to several events ranging from regulatory issues to profit-taking.
Down, but not out
For example, in March the price of the token reached an all-time high of $11.82. Since that time, however, the cryptocurrency has struggled to maintain momentum. In the intervening period, Worldcoin reached the oversold level, while the same was highlighted by the Relative Strength Index (RSI).
The RSI reveals the momentum around a cryptocurrency. A value above 70 indicates that a token is overbought. If it is lower than 30, the token is oversold.
According to Santiment, the RSI on the 4-hour chart of Worldcoin was 21.04 on July 1. This meant that the token was oversold. However, at the time of writing, the reading had improved somewhat.
Source: Santiment
This was a sign that sellers were exhausted and buyers had taken advantage of the discount. Here it is also important to mention that at the time of writing, the price had increased by 6.13% in just 24 hours.
Should momentum remain bullish, WLD’s price could close to $3 in the near term. However, traders may need to be careful. If the RSI value, which at the time of writing was 56.84, is 70.00 or higher, the token is overbought.
If this happens before the price reaches $3, WLD’s price could recover. However, according to signals from the Bulls and Bears Indicator, that may not be the case.
Taurus lead the way
This indicator looks at the activity of buyers (bulls) who have purchased more than 1% of the total trading volume. The sellers (bears) who sold more than 1% of the trading volume are also taken into account.
If there are more bulls than bears, the price of a token may increase. But if bears outnumber bulls, a decline could happen. There were for Worldcoin more bulls than bears.
Source: IntoTheBlock
If this continues, the cryptocurrency’s price would move closer to $3 as initially stated.
Moreover, the sentiment around Worldcoin has also changed. Previously, the weighted sentiment was negative, indicating that most reactions to the project online were gloomy. However, at the time of writing, the statistic had risen to 0.932.
If the sentiment remains positive, demand for WLD could increase. And as long as holders of the cryptocurrency decide not to sell, the token will most likely not fall below $2.
Source: Santiment
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Considering the above analysis, WLD could continue to climb the charts. However, if the bulls struggle to maintain their momentum, the upswing could be neutralized.