Here’s why SUI could drop 27%

• The Sui price faced pushback from its all-time high of $2.18 on Monday, suggesting a decline ahead.
• Technical analysis shows that the SUI has formed a bearish divergence on a momentum indicator.
• A daily candle close above $2.18 would invalidate the bearish thesis.

The price of Sui (SUI) is extending its decline on Wednesday after being rejected from the all-time high of $2.18 on Monday. Technical analysis continues to support a short-term bearish trend as the formation of a bearish divergence on a momentum indicator suggests weakening upside momentum.

The Sui price is showing signs of weakness

Sui’s price bounced back from its all-time high of $2.18 on Monday, after three consecutive weeks of gains of more than 70%, and fell slightly the next day. At the time of writing on Wednesday, it continues to trade lower around $1.90. If this resistance level at $2.18 holds, Sui’s price could extend the 27% decline to $1.38, its daily support level.

Moreover, the Relative Strength Index (RSI) indicator supports this bearish thesis on the daily chart. The higher high of the SUI price formed on Monday does not reflect the lower high of the RSI for the same period. This development is called a bearish divergence and often leads to a trend reversal or short-term crash.

SUI/USDT daily chart

However, the bear thesis would be invalidated if the SUI price breaks and closes above $2.18. This scenario could see Sui’s price rise to form a new all-time high of $2.87, the 141.40% Fibonacci extension level drawn from an early August low of $0.48 at an early October high of $2.17.