Prospects for ASTER price ahead of large-scale token unlocks

After the plummet of 14.6% on Tuesday due to rumors about token unlocking, Aster (ASTER) entered Wednesday's trading session in a stable state. However, the growing indifference from the derivatives trading community is casting a bearish risk over this coin.

The risk of token unlocking is real

Quinten Francois, host of Coin Compass, shared on X on Tuesday that 704 million ASTER tokens will be unlocked on Wednesday, equivalent to 8.8% of the total supply. This move causes the circulating supply of tokens to surge from 5% to 13.8% in just one day.

However, most of the tokens unlocked this time are only related to the airdrop from the Token Generation Event (TGE) – which has already been traded before and is part of the circulating supply – so it does not create additional selling pressure. On the contrary, the unlocking event of 320 million ASTER tokens on Sunday is the factor to pay attention to, as it will increase the circulating supply by an additional 4%.

Notably, on October 17th, the monthly distribution cycle will kick off, starting with 183.13 million ASTER tokens. Subsequently, each month the market will have to receive additional releases ranging from 123.09 million to 183.11 million tokens, creating continuous and steady supply pressure.

AST token unlock event | Source: DropsTab## The derivatives trading market shows that optimism is declining

According to data from CoinGlass, the open contract (OI) of AST has plummeted 7.74% in the last 24 hours, leaving only 1.12 billion USD. This trend indicates that capital is being withdrawn strongly from the derivatives trading market, reflecting a significant decline in investor interest.

At the same time, the funding rate also fell from 0.195% on Tuesday to only 0.0108%. A positive funding rate indicates that bulls have to pay fees to keep the futures contract price aligned with the spot price, while balancing the impact from leverage. However, the deep plummet of this index shows that the confidence in the bullish trend from buyers is gradually fading.

ASTER's derivatives data | Source: Coinglass## Aster bounces back in the bearish channel before the token unlock on Sunday

On the 1-hour chart, Aster has bounced off the support trendline within the bearish channel, signaling the end of the recent correction sequence. Previously, the weakness had formed a "Death Cross" pattern when the 50-period EMA crossed below the 200-period EMA.

Technical signals currently lean towards the bulls: RSI at 45 indicates that Aster has escaped the oversold zone and returned to a balanced state, while the MACD line crosses above the signal line – a sign that the recovery momentum is gradually being strengthened.

Hourly chart of ASTER/USDT | Source: TradingViewIn the short term, the uptrend may continue towards the 50-period EMA at 1.7261 USD, then challenge the resistance line of the descending channel, coinciding with the important Pivot Point level of 1.8554 USD.

However, a bearish scenario may occur if the upcoming token unlock increases supply pressure. In that case, ASTER risks falling back to the psychological support zone of 1.50 USD, or even plummeting further down to the S1 level at 1.2748 USD.

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