FTX’s native token FTT has been on a wild ride lately, especially in the wake of recent market fluctuations. Despite FTX making payouts to its creditors, the altcoin has struggled to find its footing in the market in recent days.
However, a game-changing moment arrived today with FTT's price surging by an impressive 44%, largely influenced by tweets from FTX founder Sam Bankman-Fried (SBF).
Sam Bankman-Fried Connects with Community
This surge in FTT's price was mainly fueled by speculative buying, as supporters of Sam Bankman-Fried rallied around his recent message. In a thoughtful reflection, SBF opened up about the hardships of letting employees go, pointing out that layoffs often result from organizational mismatches, poor management, or unsuitable work environments rather than individual shortcomings. While he recognized the necessity of parting ways with unproductive team members, he emphasized that it often reflects leadership failures rather than personal flaws.
Despite the price rally, the Chaikin Money Flow (CMF) indicator revealed that the increase was not supported by significant capital inflows. Instead, it was driven by the positive sentiment surrounding SBF and FTX. The lack of a matching surge in buying volume suggested that the price hike was more speculative than sustainable.
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FTT CMF. Source: TradingView
Additionally, as FTT's price soared, it became apparent that investors were cautious about fully committing to the token. The neutral reading on the CMF indicated weak inflows, hinting that the price surge might not have long-term staying power. Without substantial backing from actual inflows, maintaining the price above current levels could be challenging, potentially resulting in fewer speculative surges.
On a broader scale, FTT's market momentum has been underwhelming in recent months. Whale addresses, usually reliable indicators of price movements, have shown minimal activity. The large wallet holders' net flows have remained neutral, suggesting that even prominent market players have shown limited interest in the token.
This lack of substantial engagement from major investors reinforces the idea that the recent price surge may not be rooted in genuine interest in FTT.
FTT Whale Inflows. Source: IntoTheBlock
FTT's Price Rally Faces Tests
FTT's remarkable 44% jump pushed the price to a peak of $2.31 before retracing to $1.75. Despite this volatility, the token has somewhat recovered from a 32% drop earlier in the week. Nevertheless, breaking past the resistance at $1.83 remains a challenge.
Given the prevailing market conditions, FTT could encounter hurdles in surpassing the $2.00 mark. The price might consolidate around $1.55 in the near term, as breaching the previous resistance proves to be a tough task. However, with the current sentiment and the lack of robust investor support, a sustained rally beyond $2.00 is uncertain.
FTT Price Analysis. Source: TradingView
If FTT manages to attract more investor interest and establish $1.98 as a strong support level, it could potentially surpass $2.31. Such a breakthrough could negate the bearish outlook, leading to further gains and a more promising recovery for FTT.