Alpaca Finance surged 1,000% in 7 days — Is a major collapse approaching?

Alpaca Finance (ALPACA) has risen to the sky over the past week, recording an increase of 1.093 percent. The price rose from just over $0.04 to nearly $0.50, soaring to $1.28 in the short-term. According to data from CoinMarketCap, its trading volume reached a peak of 254.45 million dollars and then dropped by more than 70 percent. Although the market has declined, ALPACA still maintains a trading position around 0.50 dollars.

The trading volume rose to the sky quickly but then slowed down, raising concerns about a reversal as the daily RSI indicator reached 72.28 in the overbought range. The recent candlestick chart, with a strong rejection from $1.00, shows that sellers are in control of buyers. As investors withdraw at peak prices, this chart typically occurs. The market is watching for the possibility of a pullback after the parabolic surge. Price action expanding on the upper Bollinger Band indicates an unsustainable market price, which may lead traders to reduce positions and cause a price correction. The volume-to-market-cap ratio is 342.44 percent, indicating potential instability in the system. Most trading imbalances exceeding this level rarely last unless market participants demonstrate support or new participation. Strong resistance barrier at $0.60, thus any unsuccessful attempts to break this price level could limit the potential for a rise.

Whenever the upward momentum runs out of steam, the price will be supported at around $0.40. Long-term accumulation may be delayed due to the increase in the number of holders reaching 77,890 and the circulating supply approaching the maximum amount. Conclusion The explosive price surge of Alpaca Finance has attracted significant interest, but technical signals indicate a potential cooling off. With the main resistance level holding firm and volumes declining, the likelihood of a strong correction is increasing. Traders will closely monitor price movements in the coming days.