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Are institutions setting to dump Ondo Finance [$ONDO], or is the demand for the altcoin picking up again?. Liquidity providers have increased token transfers significantly.
According to Nazoku, CEXs and market makers have recently rushed to find liquidity for $ONDO on behalf of institutions.
In fact, more than $6.83 million worth of $ONDO was sent out to find buyers. Nazoku reported that FalconX sent $3.89 million of $ONDO to Binance.
Also, Ondo Finance sent $1.46 million of $ONDO to Coinbase as part of the planned 4 million token transfer. Finally, Coinbase sent $1.48 million of $ONDO to Bybit.
Looking at historical patterns, these transfers suggest that institutions are hoping to facilitate large token sales. Previously, similar activity preceded price weakness, with the market seeing increased selling pressure.
How’s $ONDO reacting, though?
So far, even with these token transfers, $ONDO has remained relatively stable. The altcoin continues to trade between $0.35 and $0.34.
At press time, $ONDO traded around $0.34 after slightly falling by 0.97%. Also, the altcoin’s trading volume dropped 39% to $56 million.
With the altcoin still holding within this margin, it’s suggested the tokens are yet to be sold. Although not sold yet, the market structure remains weak and strongly leaning bearish.
A look at the Awesome Oscillator showed that the momentum indicator has held negative for four consecutive days. A negative value here suggested that short-term momentum is currently weaker than the long-term momentum.
On top of that, $ONDO still holds below both short-term and long-term moving averages, reflecting strong downside pressure. These two indicators signal the likelihood of continued weakness.
Where is the weakness coming from?
AMBCrypto’s analysis of the market flows revealed that the current weakness is primarily arising from the derivatives market. In fact, looking at Futures flows, $ONDO’s inflows have not outpaced outflows for weeks.
Over the past week, for example, the altcoin saw $444 million in Futures outflows compared to $410 million in inflows. Over this period, Futures netflow dropped 102% to -$34 million, a clear sign of aggressive market exits.
That’s not all; the Spot side has mostly seen strong market demand. The market delta, for example, has remained positive over the past week.
Coinank data showed that the altcoin delta sat around 2.1 million at press time, marking a slight drop from 2.5 million the previous day.
With derivatives selling while Spot buying, it leaves the market at a crossroads, which explains the sideways movement.
Therefore, if the market persists, we could see $ONDO continue to hover around $0.34 and $0.35. However, if the recent transfer further increases the sell pressure, the altcoin will breach the range and fall to $0.32.
Final Summary
- CEXs and market makers are currently scrambling to find liquidity for $ONDO, moving $6.8 million worth of tokens to exchanges.
- $ONDO remains range bound, holding between $0.34 and $0.35, with bears eyeing a drop to $0.32.