TWT Price Analysis: Trust Wallet Token Correction Follows Massive Profit-Taking

Trust Wallet Token Rally Meets Technical Resistance

Trust Wallet Token TWT experienced a significant price surge reaching $1.33 before entering a correction phase. The cryptocurrency currently trades near $1.10, maintaining a 37% gain over the past 24 hours despite the recent pullback.

The TWT price movement gained attention following social media activity from Binance founder CZ. However, technical analysis reveals the rally was fundamentally driven by chart patterns rather than social media sentiment alone.

Technical Breakout Pattern Achieves Target

Inverse Head and Shoulders Formation

The TWT price chart displayed a classic inverse head and shoulders pattern on the 2-day timeframe. This technical formation typically signals trend reversal with specific price targets for traders.

The breakout occurred before the social media catalyst, suggesting the technical setup was already primed for upward movement. The social media attention simply accelerated the price action toward predetermined technical levels.

Target Achievement and Profit Realization

Smart money traders began profit-taking once TWT reached the pattern's projected target above $1.17. This strategic selling created immediate downward pressure on the token price.

Exchange Flow Data Reveals Massive Selling Pressure

1600% Increase in Exchange Inflows

Exchange net flows provide crucial insight into market sentiment and trader behavior. TWT experienced a dramatic shift in token movement patterns over a 48-hour period.

The data shows flows changing from negative 177,980 TWT on September 17 to positive 2.84 million tokens just two days later. This represents a staggering 1,600% increase in tokens flowing onto exchanges.

Such massive inflows typically indicate holders rushing to sell positions and lock in profits, creating substantial near-term selling pressure on the asset.

Whale Behavior Confirms Distribution Phase

Large Holder Selling Activity

Whale wallets holding between 10 million and 100 million TWT tokens have been systematically reducing their positions since early September. These large holders decreased their collective holdings from 248.9 million to 241.4 million tokens.

At current market prices, this represents approximately $8.23 million worth of TWT tokens being distributed by major holders. This selling activity occurred both before and during the recent rally.

The whale distribution pattern removes a key support mechanism that typically helps absorb retail selling pressure during market corrections.

Technical Analysis Shows Bearish Divergence

RSI Momentum Indicator Signals

Long-term technical indicators present cautionary signals despite short-term price excitement. Since December 2024, TWT price action has formed lower highs while the Relative Strength Index RSI created higher highs.

This configuration represents a hidden bearish divergence pattern. The RSI momentum indicator measures the strength of buying versus selling pressure in the market.

The divergence suggests underlying momentum has been insufficient to support a genuine trend reversal, keeping the broader downtrend structure intact.

Price Levels and Risk Assessment

Support and Resistance Zones

Technical analysis identifies several critical price levels for TWT going forward. Key support levels are positioned at $1.00, $0.84, and $0.71 respectively.

A breakdown below the $0.71 support level could expose TWT to deeper losses targeting the $0.63 region. These levels represent significant downside risk for current holders.

Bullish Invalidation Levels

For the bearish outlook to be invalidated, TWT would need to achieve a daily close above $1.42. Ideally, sustained movement above $1.63 would provide stronger confirmation of trend reversal.

These levels represent the minimum requirements for bulls to regain control of the price action and establish sustainable upward momentum.

Market Outlook and Trading Implications

Short-term vs Long-term Perspective

The current TWT price rally appears to represent a technical target achievement rather than the beginning of a sustainable uptrend. The combination of profit-taking, whale distribution, and bearish divergence creates challenging conditions for further upside.

Maintaining support above the critical $1.00 level will be essential for preventing a deeper correction phase. Traders should monitor exchange flows and whale behavior for signs of demand returning to the market.

Risk Management Considerations

The technical setup suggests elevated correction risks in the near term. The 1600% surge in exchange inflows demonstrates how quickly market sentiment can shift from bullish to bearish.

Current holders should be prepared for potential volatility and consider appropriate risk management strategies based on their investment timeframes and risk tolerance levels.

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