Sandbox (SAND) price analysis 29 Dec: Is it time to buy the dip?

SAND may stay range-bound in the short term

Pixel art illustration feature the word Sandbox and an image of rapper Snoop Dogg                                 
In September 2021, Sandbox announced a partnership with the rapper Snoop Dogg – Photo: The Sandbox
                                

The Sandbox, a blockchain-based decentralised metaverse, came into focus when Republic Realm purchased some of its virtual land for a record $4.3 million in November. 

Sebastien Borget, chief operating officer of Sandbox, said that virtual real estate sales have exploded in the past couple of years. Since 2019, the total value of virtual land sold is to the tune of $211 million.

In September, Sandbox announced a partnership with the rapper Snoop Dogg, who will set up his mansion and non-fungible token collection, perform live concerts and interact with players in the metaverse. A piece of land near Snoop’s mansion was sold for $450,000.  

PwC Hong Kong, an international subsidiary of the global PricewaterhouseCoopers (PwC) organisation, also jumped into the metaverse space with the acquisition of virtual land in Sandbox at an undisclosed amount. PwC Hong Kong plans to leverage its “expertise to advise clients” on the metaverse on a new generation of professional services, including taxation and accounting.

Could partnerships with celebrities and the entry of large organisations into the metaverse boost sentiment in Sandbox’s native token SAND? Will SAND go up? Read the SAND price analysis to find out what the charts suggest.

Sandbox technical analysis: weekly chart

Red line chart illustrating the price of SAND between September 2020 and December 2021
Sandbox technical price analysis (weekly), 29 December 2021 – Credit: Currency.com

SAND’s price started a strong bull run from $0.74 on 28 October and rallied to an all-time high of $8.48 on 25 November, recording massive gains of 1,045% within a month.

This strong rally pushed the relative strength index (RSI) above 94, indicating that the rally was overextended in the short term. Vertical rallies are rarely sustainable and are followed by sharp declines as traders rush to book profits.

The SAND/USD pair dropped to the 38.2% Fibonacci retracement level at $4.91, which acted as a strong support. This suggests that sentiment remains positive and traders are buying on dips.

The subsequent rebound is facing selling near $7, indicating that higher levels are attracting profit-booking from the bulls. The bears will now fancy their chances and attempt to pull the price below $4.91.

If they succeed, the pair could decline to the 50% retracement level at $4.11. This is an important support for the bulls to defend because if it cracks, the correction could deepen to the 61.8% Fibonacci retracement level at $3.31. 

Contrary to this assumption, if the price turns up from the current level or the support and breaks above $7, the pair could retest $8.48. A break and close above this level could signal the resumption of the uptrend.

The $10 level may act as a psychological barrier but if crossed, the up-move may reach $12.67.

Sandbox technical analysis: daily chart

Red line chart illustrating the price of SAND between September 2020 and December 2021
Sandbox technical price analysis (daily), 29 December 2021 – Credit: Currency.com

SAND’s price is correcting in an uptrend. The rebound off $4.76 met with strong selling in the zone between the 61.8% Fibonacci retracement level at $6.45 and the 78.6% retracement level at $6.91. 

The bears will now try to sink the price to $4.76 where buyers will attempt to arrest the decline. On the upside, the downtrend line is the key resistance to watch out for. A break and close above this resistance will suggest that the downtrend may be over.

The buyers will then try to push the price to the all-time high. If bulls clear this hurdle, the uptrend could resume. Contrary to this assumption, a break and close below $4.76 could pull the price down to $4. 

Sandbox: Buy or sell at current levels?

Sandbox’s price analysis suggests that bulls are buying on dips and bears are selling on rallies. Usually, this results in a range for a few days. A break and close above the downtrend line could push the price to the all-time high while a drop below $4.76 could signal a deeper correction.

Whatever the outcome might be, your decision to trade depends on your attitude to risk, your expertise in this market, the spread of your investment portfolio and how comfortable you are about losing money. This analysis does not constitute investment advice. It’s important to make your own analysis before deciding to invest. You should never invest more than you can afford to lose.

Further reading

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