Thanks to the recent hype in the metaverse and gaming, the Sandbox project has been one that has prevailed. Shortly after Facebook’s parent company was renamed “Meta” on October 28, 2021, SAND saw a nearly 700% increase in a month, creating massive wealth.

However, in line with the market-wide sell-off, SAND also saw a significant correction in December 2021 and early January 2022.

But towards the end, a while before other coins started to recover, SAND started to recover and broke out of the 50-period moving average. From about $3, it hit nearly $5 — recovering nearly 66% in two weeks. It firmly broke out of the $4.2 resistance zone and was trading just above it at the time of writing.

However, the region between $4 and $5.5 has served as a congestion zone, so a major recovery from this point would require significant stimulus.

SAND/USDT | Source: TradingView

Nevertheless, the current situation offers a unique opportunity to buy. Even on-chain stats for SAND seem to largely suggest the same thing. Judging by historical performance, the MVRV-Z score for SAND suggests that it is not yet too overvalued and therefore offers an attractive entry point regarding its price.

MVRV-Z Score | Source: Santiment

The N/A ratio for ZAND also seemed to point in the same direction as the MVRV-Z score. Looking at its movement regarding its price, one can conclude that it is quite well valued. And so a good opportunity to ride the moving train. The return from this point will not be extraordinary, but this would keep the boat afloat.

N/A ratio | Source: Santiment

On top of that, social dominance for SAND has also seen a major resurgence in recent days with interesting news from the ecosystem.

The project has recently been involved in a series of developments. The most recent from luxury fashion brand Gucci buying an ‘unnamed’ amount of virtual land on SAND. Good news, coupled with more social chatter, may indicate optimism in the future.

Social dominance | Source: TradingView

However, things are not rosy on all fronts. Certain statistics point to some worrisome signs that should be looked at.

According to data from Santiment, the supply of SAND tokens held by top non-exchange addresses has fallen, while the supply of top exchange addresses has increased by nearly 33%.

This could be cause for concern as it could show coins leaving the wallet and entering exchanges – most likely with the intent to cash out.

Tokens held by top non-exchange addresses vs. tokens held by exchange addresses | Source: Saniment

In addition, the adjusted price DAA divergence failed to provide a major buy signal despite the significant price recovery. So the coin may be lacking strength and conviction on the bullish side right now, thanks to the worrying signals from some on-chain stats.

Overall, however, SAND represents a good opportunity for a safety-minded investor to buy in the coin, as the current scenario has quite a favorable risk-benefit ratio. And it can provide reasonable returns in the short to medium term.

This post Where is SAND now on the favorable risk/reward scale?

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