Alpaca Finance (ALPACA) has surged dramatically over the past week, recording a 1,093 percent gain. The price jumped from just above $0.04 to nearly $0.50, briefly spiking to $1.28.
According to CoinMarketCap data, its trading volume reached its highest point at $254.45 million and subsequently declined beyond 70 percent. Although the market has declined, ALPACA maintains its trading position around $0.50.
Trading volume increased rapidly but slowed afterward, creating worries about a turnaround because the RSI daily indicator reached 72.28 in the overbought range.
The recent candle pattern, with its sharp rejection from $1.00, shows that sellers are controlling buyers. When investors cash out at price peaks, this chart movement typically occurs.
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Market Eyes Potential Pullback After Parabolic Surge
Price activity extending above the upper Bollinger Band indicates that market levels are unsustainable, which might cause traders to reduce their positions and trigger a price correction.
A volume-to-market cap ratio of 342.44 percent indicates potential instability in the system. Most trading imbalances beyond this level seldom persist unless market participants demonstrate renewed support or involvement.
A strong resistance barrier stands at $0.60, so any unsuccessful attempt to break this price point could restrict potential price appreciation.
Source: Tradingview
Whenever momentum runs out of steam, price support exists at around $0.40. Long-term accumulation may experience delays due to increasing holder numbers reaching 77,890 and circulating supply approaching maximum numbers.
Conclusion
Alpaca Finance’s explosive rally has sparked massive interest, but technical signals indicate a likely cooldown. With key resistance holding and volume dropping, the possibility of a sharp correction is increasing. Traders will be watching price action closely in the coming days.
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