SPX6900 Plummets 10% as Buyers Flee—But This Critical Breakout Signal Could Save It

Blood in the water for SPX6900 as liquidity evaporates overnight. The index got crushed—down a brutal 10%—after buyers vanished faster than a crypto influencer's credibility.

The silver lining? Charts whisper about a potential breakout... if it clears one key level.

Technical traders are eyeing the wreckage like vultures. A decisive flip above the breakdown zone could trigger a violent short squeeze. Fail here? Enjoy the ride back to lower support.

Funny how 'market makers' always disappear when volatility spikes—almost like they never believed in the trade to begin with.

Derivatives behind SPX investor woes

SPX’s collapse wasn’t random. The memecoin saw an aggressive surge in short activity.

On the 1st of July, SPX’s Funding Rate on CoinGlass plunged into negative territory, registering at -0.0183%.

A deeply negative Funding Rate indicated that traders are aggressively shorting the asset and paying a periodic premium to maintain those positions.

Source: CoinGlass

This increase in short activity has coincided with a decline in Open Interest, which dropped 7.16% to $113.02 million. The decline reflected capital exiting both long and short contracts, but liquidation data revealed who lost.

Of the $199,030 liquidated, $176,010 came from long traders caught on the wrong side of the move.

Spot traders attempt to stabilize—Will that happen?

Despite the bearish sentiment and price decline, accumulation continued in the spot market for four consecutive days.

CoinGlass Spot Exchange Netflow revealed that investors have been purchasing SPX and transferring it into private wallets for long-term holding. During this period, $2.83 million worth of SPX was accumulated.

Source: CoinGlass

However, data shows that spot purchases have sharply declined, falling from $1.83 million on the 30th of June to just $87,000 on the 1st of July.

This drastic difference suggested that spot investors may be anticipating further downside or have shifted their attention elsewhere.

AMBCrypto analyzed SPX’s price action to understand whether spot traders remain bullish or are moving to the sidelines.

Price chart hints at further decline

Technical analysis showed that SPX traded at a key support level within a broader bullish symmetrical triangle.

Source: TradingView

The memecoin was at $1.1720, and a breakout from this pattern could trigger a 27% rally toward $1.6413, the upper boundary of the triangle.

However, a bullish breakout remains unlikely given current market indicators.

The Relative Strength Index stood at 47.91 and trended downward. An RSI below 50 signals that selling pressure is dominant.

Source: TradingView

If price revisits the lower support NEAR $1.0858, a decisive close below could flip the structure completely.

On top of that, retail exhaustion may delay any strong recovery. A revisit to $1.08 might offer a better re-entry point for sidelined bulls.

Overall, the market maintains a bearish stance. Although support levels are in play, sentiment and technical indicators suggest a further decline may occur before any substantial rally materializes.