LAB recorded one of its sharpest daily declines, losing 32.45% in the last 24 hours, dropping its price to $7.16.
Despite aggressive sales, trading activity accelerated rather than weakened.
Daily trading volume increased by 45.77% to over $660 million; This showed that market participants continued to take positions throughout the decline.
Increased volume during a sharp decline indicates that investors are actively repositioning rather than exiting the market altogether.
Such conditions often reflect increased speculation; Sellers continue to defend lower levels as buyers attempt to establish value.
As a result, accession remained high even after LAB Revisited prices were last seen before their rise.
Why did leveraged investors increase risk?
Derivative activity also strengthened despite the sharp correction.
Open Position (OI) rose 83.74% to $223.53 million even as LAB continued its decline; This shows that new leveraged positions are entering the market instead of widespread position closings.
This combination typically reflected increased speculative participation as both bulls and bears increased exposure during increased volatility.
But increasing OI with falling prices generally indicates that new short positions are contributing to the broader decline. This shift also showed that investors were expecting another big move rather than a prolonged consolidation phase.
Price volatility is likely to remain high until leverage begins to unwind.
However, sustained OI growth showed that traders continued to invest fresh capital despite the recent crash, underscoring confidence that another directional move could emerge soon.
Could shorts spark a recovery?
Professional investors maintained the slight uptrend despite LAB’s sharp correction.
Binance’s Best Trader Long/Short Ratio It showed that 51.33% of positions remained long, while 48.67% remained short; This shows that experienced participants have not completely abandoned the uptrend.
Meanwhile, the continued rise in OI suggests aggressive short positions have also entered following the breakout towards the $6.02 support zone.
This type of positioning often created dense pockets of leveraged shorts near local bases.
If LAB defends its current support, even a modest rebound could force short sellers to quickly cover positions, increasing buying pressure through liquidation.
However, this scenario would represent an upside short squeeze rather than a confirmed reversal.
Can LAB defend support after collapse?
LAB After recovering from intraday lows near $5.82, it struggled to stabilize above the $6.02 support.
Although the recovery remained limited, buyers pushed the price above the support.
The Relative Strength Index (RSI) fell to 41.15, reflecting reduced selling pressure without entering oversold territory. This reading showed that sellers were losing some momentum while buyers were not able to fully regain control.
While the chart pinpoints $11.86 as the nearest resistance, $20.00 remains the next major recovery target if demand strengthens.
If LAB continues to hold above $6.02, crowded shorting could trigger a reversal trend squeeze towards higher resistance.
However, losing this support would likely subject the token to another wave of selling before a sustainable recovery develops.
Source: TradingView
Final Summary
- Despite the sharp decline, LAB kept volatility high by taking out new leveraged positions.
- Crowded shorts near support could precipitate a relief rally if buyers defend current levels.
