Technical Breakout Sparks Rally
World Liberty Financial’s WLFI token is showing some impressive movement today, climbing over 33% in just 24 hours. After being stuck under pressure for nearly seven weeks, the token has finally broken through a descending diagonal resistance that had been limiting its price action since late September. I think this is significant because it’s not just a small bounce – we’re seeing a proper breakout that’s caught traders’ attention.
The token reclaimed key resistance levels and managed to flip the major $0.15 zone from resistance to support on the 4-hour chart. That’s the kind of move that technical analysts watch for, as it suggests the momentum might have some staying power. Traders are now looking at $0.25 as the next potential target, which would mark the highest trading level we’ve seen since September 22.
Indicators Point to Renewed Interest
What’s interesting here is that the technical indicators seem to be lining up with the price action. The MACD recently formed what’s called a Golden Cross, with the blue line crossing above the orange signal line. This pattern typically suggests that buying momentum is returning, which could mean WLFI is setting up for a more sustained bullish move.
Meanwhile, the Money Flow Index has climbed to 55.57, showing renewed investor interest. When MFI readings increase like this, it usually means liquidity is flowing into the asset, which strengthens the ongoing recovery. These indicators together paint a picture that suggests there might be more upside potential if the current momentum holds.
Short Squeeze Adds Fuel
This rally has put short traders in a tough spot. Data from CoinGlass shows $3.45 million in short positions were liquidated in the past 24 hours alone. That’s not insignificant for a token of this size. What’s more concerning for short sellers is that further gains could trigger even more liquidations.
If WLFI reaches $0.168, we could see another $2.46 million in forced liquidations. A move to $0.184 might impact contracts worth $3.91 million. These forced buying events can create a feedback loop that amplifies the upward pressure, potentially pushing prices even higher than fundamentals alone might suggest.
What to Watch Next
For traders watching this move, the key levels to monitor are pretty clear. Maintaining gains above the breakout resistance and having volume support is crucial for any sustained move toward that $0.25 target. Short-term traders might try to ride the momentum, but the higher-timeframe support levels will ultimately determine whether this rally has legs.
There’s always the risk of pullbacks, of course. If the token breaks back below the breakout line, we could see it head back toward support around $0.11. That’s why it’s important to watch volume and momentum indicators closely to see if buyers can maintain control.
The combination of technical breakout, bullish MACD, rising MFI, and short liquidations does create a favorable setup for WLFI. But in crypto, things can change quickly. If buyers can maintain their grip, the altcoin might continue its impressive surge. Just remember to keep an eye on those key support and resistance levels – they’ll tell you whether this is the real deal or just another false breakout.
