Near Protocol [NEAR] reversed its weekly trend from red to green after gaining by over 11% in 24 hours. Here, it’s worth noting that this abrupt spike in price was consistent across the whole crypto sector. In fact, the market added another 2.69% to its capitalization.
However, a few factors have been contributing to this double-digit rally. These factors include a Q3 volume report and a new governance proposal, despite outflows in Bitwise’s Spot ETF product.
Q3 trading volume report and new proposal charges NEAR
Bitwise released Q3 reports for NEAR Intents, which showed its volume accelerated from $2.40 billion in July to $4.80 billion in September.
In essence, Q3 volume hit $10.41 billion, up by more than 66% Quarter-on-Quarter (QoQ) and 891% Year-on-Year (YoY).
Additionally, there is now a new proposal up for voting in the House of Stake with the protocol looking to reduce token dilution. The proposal includes cutting issuance from 2.5% to 1.6% over the next 24 months.
This proposal will strengthen NEAR’s tokenomics as it addresses supply dynamics.
Why is the altcoin still confined in a range?
On the daily charts, there was not much to address in terms of structure breaks. This, because NEAR was still confined in a tight sideways range but had risen above $5.
The Stochastic Momentum Index rose to the overbought territory with a reading of 53. The Choppiness Index was declining with a reading of 51, indicating the uptrend was starting to become clear.
While the uptrend was still alive, there was strong resistance at $5.50, with more than five touches. For more than a month, bulls have failed to breach this level, even though capital inflows have remained positive.
Deducing the recent net flows of the Bitwise Spot NEAR ETF [NRR], it could give a probable reason why bulls were struggling at $5.50.
Spot NEAR ETF sees first outflows since launch
According to SoSoValue, NRR saw its first ever capital outflows since it was launched on 29th September. The cumulative total for the product was $85.56 million before this outflow of $2.54 million in the last 24 hours.
This weakness in capital flows was evident in the price overlaid on the chart. It highlighted sudden upswings and downswings depending on the activity.
As such, traders should be wary of what could come next now that the Spot NEAR ETF flows have turned red.
However, the market structure will remain bullish unless the altcoin breaks and holds below $4.50. Hence, the outflows may not be a threat to the existing trend.
Final Summary
- Near Protocol surged by over 11% after Bitwise’s Q3 report on NEAR Intents volume and a new governance proposal.
- NEAR was struggling to break past a month-long resistance at $5.50.
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