SUN Price Consolidation Amid Market Conditions and Buyback Strategy
Following a significant rally after its platform launch and promotion by Tron Founder Justin Sun, the SUN token has entered a consolidation phase. This retracement has been further influenced by broader market conditions, especially Bitcoin’s recent volatility. However, with Sun’s recent announcement of a 100% on-chain buyback and burn for the SunPump project, there is renewed optimism that this could drive the token’s price to new highs.
Impact of Justin Sun’s 100% Buyback and Burn on SUN Price
The community initially suggested burning liquidity LP tokens as a means to increase trust among the broader crypto market. However, Justin Sun identified limitations in this approach and opted instead for a 100% buyback and burn strategy, implemented on September 3. According to Sun, this method is more straightforward and easier for the community to verify.
SunPump currently has a total supply of 19.9 billion tokens, with 9.8 billion already in circulation. With a market cap of $278 million, the buyback and burn strategy could potentially propel the asset towards a $1 billion market cap and beyond.
On August 25, SUN achieved its all-time high market cap, following a surge in interest due to the short-lived meme season on the Tron network. Notably, during its previous peak, SUN had a total supply of only 21 million tokens, and its price reached $50.
The buyback and burn process is directly tied to fees generated by the SunPump platform. However, according to Dune Analytics, revenue from token launches has been declining, with the platform recording its lowest daily revenue on September 3, generating only 195,671 TRX (approximately $29,743). This marks a sharp contrast to its peak, when it generated over $555,000 in revenue in a single day. Despite this, the platform’s long-term growth potential indicates that revenue – and the corresponding buyback and burns – could increase significantly as the platform expands.
Technical Analysis Suggests Bullish Momentum
Despite the longer-term bullish outlook, SUN has been in a short-term consolidation phase, with its price oscillating between the 50% Fibonacci retracement level at $0.028 and the 61.8% level at $0.026.
Resistance is expected around the 23.6% Fibonacci retracement level at $0.033. A break above this level could signal a continuation of the uptrend, with the potential for up to a 90% price increase. Conversely, strong support lies at the 61.8% Fibonacci retracement level at $0.026. If this support is breached, a further decline towards the 78.6% level at $0.022 is possible.
Currently, SUN’s price is hovering around the 50% Fibonacci retracement level, which is often a critical juncture for determining the next market move. The confluence of the 61.8% retracement level with the lower boundary of the recent price range suggests this area is a key support zone.
There are also signs that a potential double top may be forming in SunPump’s price action, making it essential for the price to stay above the 61.8% Fibonacci level. Failing to hold this level could result in the asset erasing its gains from the past month.
In summary, with the recent buyback and burn announcement, SUN price has remained relatively stagnant as investors assess overall market sentiment. Nonetheless, increased price volatility could soon follow as SunPump’s fundamentals continue to evolve.
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