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World Liberty Financial (WLFI) recorded a decline of almost 8% in the last 24 hours, showing its weakness after the USD1 shock. The weakness of the stablecoin linked to the Trump family caused panic in the ecosystem, and its effects on the price of WLFI are still felt.
This decline comes at a crucial time because WLFI has built a bullish run pattern. Now, with the buying and selling pressure from the whales fading, the token is at a crucial point.
Mar-a-Lago rally fades as USD1 shock and RSI divergence lead to WLFI pullback
WLFI’s recent volatility began with Mar-a-Lago Crypto Event. Between February 16 and February 18, the price jumped 32%. This growth formed the cup part of a cup and handle pattern, which is a bullish configuration where the price bounces, settles, falls, and then tries a breakthrough.
Warning signs appeared before the decline.
The Relative Strength Index (RSI), which measures momentum strength on a scale of 0 to 100, rose between February 3 and February 18 even as the broader WLFI trend remained weak. This created a hidden bearish divergence.
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The hidden bearish divergence occurs when the momentum increases, but the price fails to confirm the strength. This often indicates that the increase may fail and a pullback may occur.
This decrease increased after… WLFI’s USD1 stablecoin weakened brieflyperhaps through a coordinated attack.
After this shock, WLFI fell about 17%, forming the handle part of its model and erasing most of its recent gains. But this decline was not driven by widespread selling by investors, which usually happens after an emotional trigger like this.
Liquidation of leverage and $35 million of whale purchases reveal the hidden accumulation
The sharp decline was associated with leveraged divestments rather than long-term investor exits.
Leverage provides traders with the ability to borrow money to increase the size of trades. The leverage ratio shows whether leveraged traders are betting that prices will rise or fall. By February 18, at the peak of the WLFI price amid a wave of positive sentiment around the Mar-a-Lago event, open interest had jumped to nearly $245 million.
Record after February 18 that the WLFI funding ratio turned negative while open interest fell sharply.
This combination confirms that leverage liquidation has occurred. Liquidation leverage occurs when bullish positions are closed out of force, resulting in a rapid decline in price without actual selling by long-term holders.
At the same time the whales began to buy.
The largest holders of WLFI, wallets with more than 1 billion tokens, have increased their participation from 8.23 ​​billion to 8.56 billion WLFI since February 19. This means that they have collected around 330 million WLFI. At current prices, that’s about a $35 million purchase.
This accumulation occurred while the price was falling, which usually indicates confidence in an imminent recovery. It also removes the doubt from the immediate sale.
Retail sales also slowed. Deposit flows to exchanges, which measure the number of tokens that investors send to exchanges for sale, have fallen sharply. On February 19, flows were 128 million WLFI. Since then it has dropped to just 8.9 million WLFIs, a drop of nearly 93%. Lower flows indicate that fewer investors are looking to sell.
Together, these signs indicate that The price of the World Liberty Financial token is falling It was largely driven by divestments rather than a true outflow of investors.
Sentiment is recovering, but critical WLFI price levels are now emerging
Investor sentiment also reflects this change. Positive sentiment towards WLFI had already started to wane at the beginning of the month as prices fell. It recovered briefly during the Mar-a-Lago rally, but fell again after the USD1 shock.
It should be noted that since February 22, the sentiment has again increased from near zero levels. This recovery shows confidence is stabilizing as panic fades.
However, the sentiment remains well below the highs seen at the beginning of February around 21, and during the recent rally in Mar-a-Lago, where the index reached 11. This divergent sentiment now directly reflects the WLFI price structure.
WLFI is now positioned at a critical technical level. To be confirmed a breakthrough, and not just a recovery, the price must be above $0.125. This level represents the neck of the cup and handle model. If this barrier is broken, it will consolidate strength and can push WLFI towards $0.166 and maybe $0.200 if the buying continues.
But downside risks remain. If WLFI falls below $0.101, the pattern will weaken significantly. If it falls below $0.095, the bullish formation will be completely invalidated and this will indicate further decline.
Recent declines seem WLFI Driven more by leveraged liquidation rather than actual sales.
The accumulation of top whales and the decrease in flows towards the platforms highlight that the strong hands are still positioned. Whether this symbol linked to the Trump family will be able to break or break depends on the possibility of buyers being able to recover the main resistances and restore confidence after the shock US $ 1.
