Sui (SUI), a Layer 1 blockchain protocol focused on scalability and low-latency transactions, is approaching a death cross, a bearish technical indicator that historically precedes steep downside moves. 

If confirmed, this event could signal a 20–35% price drop, placing SUI within the $1.90–$2.20 support range, despite the project’s robust on-chain fundamentals. Aurudium’s latest publication gives readers a complete overview of this topic, explained by their brokerage experts.

Technical Breakdown: Death Cross Threatens SUI Outlook

As of July 7, SUI is trading near $2.91, hovering just above its 50-day Exponential Moving Average (EMA), which is also positioned slightly above the 200-day EMA. However, the gap between these key trend lines is narrowing, a condition that often sets the stage for a death cross, a phenomenon where the 50-day EMA crosses below the 200-day EMA.

Historically, the death cross serves as a bearish signal, suggesting that momentum is fading and a longer-term downtrend may be developing. Notably, SUI’s last death cross occurred in March, preceding a 30% drop that saw prices retrace to critical support zones.

Currently, SUI price action is locked within a descending parallel channel, formed since early May, marking a sustained downtrend. Recent attempts to breach the channel’s upper boundary have failed, with the flattening 50-day EMA reinforcing resistance. Unless bulls overcome this confluence, the probability of a rejection and subsequent decline increases dramatically.

Price Targets: Breakdown Could Push SUI to $1.90–$2.20

Should the rejection scenario unfold, SUI could retest the $1.90–$2.20 demand zone, a region that previously acted as a launchpad during the March lows. This support range lies 20–35% below current price levels, aligning with the measured downside projection from the descending channel.

Momentum indicators back the bearish case. The Stochastic RSI on the daily timeframe is deep into overbought territory (>80), suggesting that the recent bullish push is likely running out of fuel. Compounding the weakness, trading volumes remain muted, signaling a lack of conviction from buyers at higher levels.

Unless bulls can reclaim and hold the $3.02–$3.10 confluence zone, which includes both the 50-day and 200-day EMAs, selling pressure may intensify. A failure to break above this key cluster could invite short sellers, potentially accelerating the decline.

Larger Timeframes: $3 Remains Critical Resistance

On the weekly chart, SUI is consolidating within a symmetrical triangle, a continuation pattern that often precedes sharp breakouts. The $3 level serves as the horizontal resistance zone, precisely aligning with the 1.618 Fibonacci retracement level drawn from the last major swing high and low. 

Since May, this resistance has repeatedly capped upside attempts, turning into a formidable ceiling.

A decisive breakout above $3 would invalidate the death cross setup and could propel SUI toward the triangle’s upper trendline, currently located near $3.50, a potential 20% rally from present levels. This move would also confirm a bullish reversal, opening the door for trend continuation toward new local highs.

On-Chain Strength: TVL Rebound Signals Long-Term Confidence

While SUI’s price chart presents a short-term bearish structure, the project’s on-chain metrics tell a different story. According to DefiLlama, Sui’s total value locked (TVL) has climbed back above 600 million SUI, approaching its all-time high. This rebound is a bullish divergence, particularly when price action is weakening.

A growing TVL often signals increased user adoption, developer activity, and demand for DeFi applications within the ecosystem. In the case of Sui, the TVL growth points to resilient fundamentals, despite bearish price action on lower timeframes. This suggests that smart money and institutional players may still be accumulating SUI or actively participating in ecosystem protocols.

Moreover, the platform’s design, offering parallel transaction execution, low fees, and object-centric data models, continues to attract attention from developers and DeFi platforms looking to build scalable decentralized applications.

Conclusion: Critical Juncture for SUI Traders and Investors

Sui (SUI) is entering a decisive phase, with the death cross setup threatening a 20–35% drop unless buyers step in aggressively near current resistance. The confluence of the descending channel, flattening EMAs, and overbought oscillators paints a bearish short-term picture. 

However, the backdrop of strong TVL growth and long-term network health offers a bullish undercurrent that may cushion the impact of any corrective move.

The next move hinges on SUI’s ability to reclaim $3 resistance. A breakout above this threshold could negate the death cross, setting the stage for a 20% rally toward $3.50. Until then, caution is warranted, and technical traders may continue to lean bearish, especially if price falters again below EMA resistance zones.

With volatility rising and technical pressure mounting, Sui remains a top watch for market participants navigating the delicate balance between macro momentum shifts and on-chain strength.