SUI struggles below $3 as price action weakens – Can the WLFI partnership lead to a reversal?

Sui price continues to trade below the $3 mark, struggling to gain momentum despite a recent partnership with Trump’s World Liberty Financial. What’s next?

Currently trading at $2.75 according to crypto.news price tracker, Sui (SUI) is experiencing weak momentum. At 42.39, the relative strength index indicates that the asset is not oversold but is still in bearish territory.

The 50-day EMA at $3.35 and the 200-day EMA at $3.02, both signal a bearish trend. If selling pressure increases, support is located around $2.70 and $2.50, while resistance is at $3.57.

In the meantime, rising trader activity is shown by a 10% rise in open interest over the past 24 hours, as per Coinglass data. Although momentum might be improved by a move above $3, a longer-term recovery depends on increased demand and stronger decentralized finance activity.

Sui’s DeFi ecosystem has shown mixed signals, according to data from DefiLlama. Total value locked has dropped from $2.05 billion in January to $1.25 billion, reflecting capital outflows. Meanwhile, the market capitalization of stablecoins has climbed from $378 million to $648 million, a sign of greater liquidity.

There appears to be a decrease in trading activity, though, as the monthly decentralized exchange volume dropped from $12 billion in January to $7 billion in February.

Sui announced a partnership with World WLFI, a Trump-backed DeFi protocol that has raised $300 million, on Mar. 6. The partnership entails exploring product development prospects and adding SUI to WLFI’s strategic token reserve. SUI initially surged about 18% on news of the partnership, but the momentum has since cooled. 

Arkham Intelligence data shows WLFI had no meaningful SUI holdings before the announcement, casting doubt about the immediate impact but leaving traders speculating that WLFI will soon start acquiring SUI.

Institutional interest in Sui has also expanded, with VanEck launching the first SUI-backed exchange-traded product last year. While this provides greater exposure to the asset, it has yet to drive sustained buying pressure. Sui, which competes with Ethereum and Solana, boasts a market cap of $8.6 billion and claims transaction speeds of up to 297,000 TPS.