Aptos [APT] has been under sustained selling pressure for a while now, with the price consistently trending lower on the chart.
In the last 30 days alone, APT recorded a 39% drawdown. Over a longer timeframe, the losses amounted to 67% from its November high of $3.37 – A sign of its persistent bearish structure.
With new supply scheduled to enter circulation, questions have emerged around APT’s near-term direction and whether inflation-driven pressure could outweigh improving on-chain signals.
Inflation risk moves into focus
Aptos is scheduled for a token unlock on 10 February, introducing approximately $12.73 million worth of APT into circulation at press time valuations, according to DeFiLlama.
Here, token inflation refers to a hike in circulating supply due to new token issuance. It is typically used to reward network participants, support development, and incentivize ecosystem growth.
The upcoming unlock represents 1.13% of Aptos’s total supply and 1.48% of its circulating supply, underlining its potential market impact. The distribution will be allocated across core contributors, the community, and investors.
Historically, token unlocks have often triggered short-term sell pressure as recipients liquidate newly issued tokens. With community members and investors accounting for over 50% of the unlocked supply, or roughly $6.58 million, downside risk might be elevated.
In an already weak altcoin environment, reflected by a market index reading of 24, additional sell pressure could accelerate price declines.
APT tests critical support as exhaustion hit
On the weekly Binance chart, APT was trading at a pivotal technical level. The price had broken below the upper demand zone, previously highlighted as a key support area. At press time, it appeared to be hovering near the $1.00-level.
Failure to hold this support could result in a new all-time low, placing APT among a small group of assets to reach that threshold since the onset of the bear market.
While there is still some downside risk, technical indicators suggested that a rebound is still possible. Despite no confirmation or clear timing on the same.
The Relative Strength Index (RSI) entered a zone commonly associated with accumulation, where the probability of a price reversal increases too. It moved into oversold territory, a condition often linked to seller exhaustion and rising buyer interest at discounted levels.
This does not guarantee an immediate rebound though. And, further downside remains possible. However, historically, such conditions increase the likelihood of a corrective bounce.
Finally, the Moving Average Convergence Divergence (MACD) also hinted at improving momentum.
Liquidity and capital flows remain supportive
Despite price weakness, liquidity conditions did exhibit some resilience though. In fact, on-chain data indicated that the Total Value Locked (TVL), a measure of capital committed to the Aptos ecosystem, has continued to rise.
DeFiLlama data also revealed that since 06 February, the TVL has risen by $14.04 million. This implied that investors may be locking assets within the ecosystem, typically pointing to a longer-term view rather than short-term speculation.
Finally, in the spot market, exchange netflows hinted at steady accumulation. Weekly data revealed consistent outflows from exchanges beginning in early January, with $2.03 million worth of APT withdrawn this week alone.
However, short-term pressure persists. Daily netflow data found approximately $536,000 in net inflows to exchanges – Illustrative of ongoing selling activity.
Final Thoughts
- A $12.73 million token unlock is expected to increase the circulating supply, raising downside risk.
- On-chain indicators and capital flows suggested there may be early signs of selective accumulation by buyers.
