The Spark token (SPK) fell by 10.65% over 24 hours, underperforming compared to the broader cryptocurrency market, which rose by 2.43%. Main reasons:
Technical correction after breaking a key support level at $0.1096 (Fibonacci level)
Profit-taking after a 37% rise over the week and 173% over the month
Continued unlocking of tokens – with 4.65 million SPK issued daily, increasing selling pressure
Detailed Analysis
1. Technical analysis (negative impact)
Overview: The SPK token broke the Fibonacci support level at 50% at $0.1096, as well as the 30-day simple moving average at $0.08916, triggering automatic sell orders. The MACD indicator also turned negative (-0.00328) on August 12, indicating bearish momentum.
What does this mean? Technical traders likely sold their positions after the price fell below the important psychological level of $0.09. The Relative Strength Index (RSI) at 35.77 suggests that the token may be in the oversold territory, which could limit further declines.
Monitoring: Will the next support level hold at $0.0635 (78.6% Fibonacci)?
2. Profit-taking cycle (mixed impact)
Overview: SPK rose by 172.7% over 30 days before this correction, with a 37% gain in the week prior to the decline. Network data shows that large investors (whales) moved 67 million SPK to exchanges over the past week (Nansen).
What does this mean? Early buyers are benefiting from profits after Spark's integration with Bitcoin lending products on Coinbase, leading to a 32% rise on August 4. The increase in 24-hour trading volume to $249 million (an 88% increase) confirms the heightened trading activity.
3. Inflationary pressures (negative impact)
Overview: 4.65 million new SPK tokens are issued daily according to the unlocking schedule. With only 13.7% of the total maximum supply of 10 billion tokens traded, dilution remains a structural negative factor.
What does this mean? Despite over $7 billion in total value locked (TVL) and institutional interest, the economics of the Spark token create ongoing selling pressure. Exchange balances also increased by 9% over the past week, indicating that holders are liquidating their rewards.
Summary
The decline in SPK combines negative technical factors and profit-taking after a sharp rise over 30 days, with the situation exacerbated by the unlocking of inflationary tokens. While the fundamentals are strong (considered one of the top 5 decentralized finance protocols by total value locked), it seems that short-term traders are focusing on managing risks associated with newly unlocked tokens.
Key point to monitor: Will Spark be able to maintain support at $0.0635? Holding at this level could pave the way for a rebound, while breaking it could test June lows near $0.03.
