NEAR price skyrockets – But will the sell-off derail its bullish momentum?

NEAR Protocol (NEAR) has recorded remarkable growth in the market, thanks to a large amount of liquidity mainly coming from on-chain users. The current market sentiment suggests the possibility of another bullish wave; however, the spot trading segment has not yet aligned with this trend and continues to witness a bearish phase.

Bullish growth of on-chain trading volume

On-chain trading activity has reached its highest level in the past 24 hours. According to data from DeFiLlama, the total value locked (TVL) of NEAR Protocol has simultaneously increased along with the trading volume on the DEX.

From September 7 until now, the TVL of NEAR has increased from $91.71 million to a new high of $111.23 million. This increase of $19.52 million reflects a significant rise in the number of NEAR tokens being staked during that period.

Source: DeFiLlamaThe trading volume on DEX has also recorded a significant increase, reaching a new high of $62.35 million, the highest since August 23. This indicates that trading activity in the market is vigorous. Over the past two weeks, NEAR has increased by 17%, confirming a continuous accumulation trend.

Support from technical indicators

The bullish momentum in the market is strengthened by technical indicators such as the Average Directional Index (ADX) and the Chaikin Money Flow (CMF). At the time of the press, the CMF had a strong growth to 0.26 in the past 24 hours. Typically, when the CMF is positive and on the rise, it indicates that the market is being dominated by buyers and trading volume remains high.

Source: TradingViewThis sentiment is also reflected through the ADX, an indicator measuring the strength of a trend. When ADX trends upward along with the price, it confirms that the trend is very positive. This is true for NEAR, as both price and ADX move in parallel. The increasingly strong bullish sentiment reinforces the overall price outlook and supports NEAR's potential for further growth.

Trend of selling off in the spot market

Although the market has recorded significant profits, there has also been an increase in the number of NEAR sold on exchanges. In the past 48 hours, the number of NEAR sold in the spot market has increased significantly.

On September 18, investors sold NEAR worth $6.94 million, and the latest data today shows that the sell-off has reached $2.90 million. In total, the amount of sell-off in 48 hours has reached $9.64 million.

Source: CoinGlassTypically, a sell-off in one day indicates that traders may be taking profits, however, two consecutive days of strong sell-offs suggest the emergence of a bearish trend.

If the situation of on-chain sell-off continues, this could negatively impact the price outlook of NEAR. However, the cash flow from investors on-chain may still bring positive signs for price movement in the future.

Mr. Teacher