VIRTUAL price is sinking: is this the end of Virtuals Protocol rally?

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As a seasoned analyst with over two decades of experience in the financial markets under my belt, I have witnessed numerous bull runs and bear markets, and the current state of Virtuals (VIRTUAL) is reminiscent of the dot-com bubble of the late 90s. The recent price drop of VIRTUAL is not unexpected; it follows the Wyckoff principles, a theory that has accurately predicted market trends in various assets over the years.

While the current bearish trend may seem disheartening to some, I believe this could be an excellent opportunity for long-term investors. The Wyckoff method suggests that after the distribution phase, we will enter the markdown phase, and the VIRTUAL price could potentially drop to the next support level at $3.00. However, if history has taught us anything, it’s that market cycles are cyclical, and the bullish trend may return once the bear market subsides.

Moreover, despite the recent price drop, Virtuals Protocol remains a key player in the AI agent sector, which is poised for exponential growth over the next decade. With a circulating supply of 1 billion tokens, matching its maximum supply, and the possibility of introducing a token burn mechanism to reduce the circulating supply, I believe Virtuals Protocol has the potential to significantly outperform other players in the market.

Investing in cryptocurrencies can be like playing a game of roulette, but with Virtuals Protocol, it seems more like a game of chess—strategic and potentially very rewarding if played correctly. So, while the current price drop may make some investors sweat, I remain optimistic about the long-term potential of Virtuals Protocol.

And as they say in the markets, “Bulls make money, bears make money, but hogs get slaughtered.” So let’s not be hogs and stay rational during this bear market!

The Virtuals Protocol’s price experiences a severe correction as it transitions into a new distribution stage following a massive 52,000% increase.

On Friday, the price of Virtual tokens dipped to $4.23, representing nearly a 20% decrease from its peak this week, as we previously anticipated.

The retreat of the token occurred at the same time as a widespread decline in its environment or sector. Specifically, GAME by Virtuals (GAME), the leading figure within the Virtuals Protocol system, saw a drop exceeding 25%, placing it among the worst performers.

As a crypto investor, I noticed a significant dip in the value of my Luna token today, with a drop of approximately 12.5%. This has brought the market capitalization down to around $130 million. It wasn’t just Luna that took a hit; tokens within other ecosystems such as Prefrontal Cortex, VaderAI, Olyn, and aixCB each fell by more than 20%. The crypto market seems to be experiencing some turbulence today.

Wyckoff Method explains the VIRTUAL price dips

It’s plausible that the value of VIRTUAL decreased based on Wyckoff’s principles, which outline the progression of price movements in financial assets. According to Wyckoff, these assets usually pass through four distinct stages. The initial stage, accumulation, is marked by subdued price activity. As illustrated in the chart below, the VIRTUAL token stayed within a narrow range from May to November, reflecting this phase of weak price action.

In response to demand outrunning supply and an increasing FOMO (Fear of Missing Out), VIRTUAL moved into the markup phase around two months ago. This period significantly boosted the token’s value.

As a crypto investor, I’m observing that the coin is now moving into the distribution phase, which might be preceded by a downturn. A significant sign of this potential shift is the appearance of a doji candlestick on my charts. This pattern is distinct due to its small body and long upper and lower shadows, indicating that the asset opened and closed at roughly the same price – a signal often associated with reversals in the market.

During the markdown stage, individuals who purchased during the fear-of-missing-out (FOMO) phase start to sell off their holdings. Consequently, the hypothetical price might fall to the next support point at $3.00, which is approximately 30% lower than its current value.

Virtuals Protocol is the market leader in AI agents

As an analyst, I find it noteworthy that despite the recent dip in prices, Virtuals Protocol continues to hold a significant position within the dynamic landscape of the cryptocurrency industry, particularly in the burgeoning AI agent sector. Notably, the protocol currently boasts a circulating supply of one billion tokens, which aligns with its maximum supply, signifying that no additional tokens will be released into circulation. An intriguing aspect is the potential for the network to implement a token burn mechanism, thereby potentially reducing the circulating supply and possibly influencing the market price positively.

In the second place, it’s worth noting that Virtuals Protocol thrives within an industry experiencing rapid growth. Predictions indicate that the AI agent market will surge from $5.29 billion in 2024 to a staggering $216 billion by 2035. If these forecasts prove accurate, Virtuals Protocol seems poised to become a significant force in this burgeoning sector.

To add to this, the protocol boasts a flourishing community. For instance, GAME by Virtuals boasts a market value of more than 245 million dollars, while Luna and aixCB are valued at over 129 million and 492 million respectively. The expansion of this ecosystem suggests that Virtuals Protocol may see further growth in popularity.

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2025-01-03 17:34