The crypto market has seen a resurgence, and among the altcoins leading the charge is Sonic (S), formerly Fantom. The asset has captured significant attention, rallying over 11% and becoming one of the most-visited coins on CoinMarketCap. While its technical indicators signal strengthening momentum, a closer look at network activity reveals a more complex picture, suggesting potential hurdles despite the recent gains.
Sonic's Price Action and Bullish Momentum
Sonic (S) has been trading within a defined range, oscillating between $0.0386 and $0.0517 for the past six weeks. Following the broader market's positive turn, S broke above a mini-range, indicating a bullish shift in its short-term trajectory. Technical analysis supports this sentiment, with the altcoin trading above the SuperTrend on the 4-hour chart, signifying that bulls are currently in control. The Chaikin Money Flow (CMF) also registered above the neutral level, confirming capital inflow. However, the CMF's recent decline from a peak suggests that some traders have begun taking profits, and while the price aims to flip the $0.05 zone, the possibility of a rejection could prolong its sideways consolidation.
Mixed Signals from Network Activity
Despite the strong price performance and significant staking by major entities like Binance, which recently staked 76 million S tokens, the underlying network activity presents a mixed bag of sentiments. The number of unique addresses on the Sonic network hit a peak, with over 8,100 new addresses added in the last 24 hours, signaling a spike in engagement and long-term confidence. Conversely, other crucial metrics show a decline: daily new addresses dropped by 31%, daily transactions fell by 47%, and total transaction fees decreased by a staggering 59%. This inconsistency indicates that while new users are joining and long-term holders are committing, overall network utilization for daily transactions is waning, which could pose a challenge to the sustained continuation of Sonic's rally.
