Can SEI Hold Above Resistance Before Flipping Traders Take Control?

Sei [SEI] has faced mounting selling pressure over the recent trading period, with broader market weakness creating conditions where even resilient projects stumble. The critical $0.1206 support collapsed, leaving the token exposed to deeper weakness near the $0.0689 level where previous buying interest historically surfaced. Spot market dynamics revealed institutional participants actively selling, confirming that downward momentum extended beyond typical retail capitulation. Once support cracked, liquidity evaporated rapidly, heightening concern that further deterioration could unfold without swift stabilization.

Derivatives Surge: Positioning Without Panic

Rather than capitulation, onchain activity told a different story. Derivatives trading exploded with 24-hour volumes reaching notable levels, while Open Interest (OI) climbed simultaneously—a pattern that contradicted the narrative of widespread liquidations. Instead of fleeing, traders were actively layering positions, suggesting conviction rather than desperation.

This behavior carries dual implications. Rising leverage during downside moves typically precedes sharp reversals, but it also invites liquidation cascades if momentum continues deteriorating. Flipping traders monitoring support levels remain acutely aware of this knife-edge dynamic, positioning to capitalize on either a violent bounce or breakdown.

Whale Distribution Masks Selective Absorption

Spot Average Order Size data revealed sustained whale participation despite falling prices. Large orders persisted through the selloff, indicating that institutional players were simultaneously distributing holdings while absorbing dips. This two-sided activity—distribution paired with selective buying—suggested bigger players were actively orchestrating outcomes rather than reacting passively to market moves.

Technical Setup Points to Potential Short-Term Bounce

Momentum indicators flashed mixed signals at current levels. RSI remained suppressed, limiting bullish strength but also showing deceleration in selling intensity. MACD stayed negative, yet histogram compression and the blue line’s upward curl hinted at fading downside velocity—a setup often preceding tactical rallies.

For structure to genuinely repair, SEI must decisively reclaim the $0.1261 range. Breaking above this zone would prevent former support from transforming into resistance, opening the door for flipping traders to exit short positions profitably. Failure leaves $0.0689 in the crosshairs and fear firmly entrenched. A larger move back above $0.20 would signal a more substantial structural improvement and remove imminent downside threat.

What Comes Next

• Leverage-Driven Volatility: The divergence between rising derivatives activity and falling spot prices suggests markets are positioned for sharp directional moves rather than steady trends.
• The Support Level Question: Whether $0.1261 holds as a launch pad or caves as weakness continuation remains the binary outcome traders monitor.
• Flipping Traders’ Opportunity: Risk-reward conditions favor those patient enough to wait for technical confirmation before deploying capital, rather than chasing the current bottom.