Virtuals Protocol (VIRTUAL) has reasserted its bullish momentum, reclaiming the $2 price level with a strong 15% daily surge. This rebound follows a brief dip below $2 last Friday that sparked concerns about a potential correction in one of 2025’s most impressive altcoin performers. However, fresh technical signals, on-chain data, and market sentiment suggest the pullback was merely a pause — not the end of the rally.
With key indicators flashing green and network activity surging, many analysts believe VIRTUAL is positioning for another upward leg. Could this be the start of a run toward $3 and beyond?
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VIRTUAL’s U-Shaped Recovery Signals Strength
On the daily chart, Virtuals Protocol has been carving out a classic U-shaped recovery pattern since its April correction bottomed out. This formation typically reflects consolidation after a sharp move, followed by renewed buying interest — exactly what we’re seeing now.
The recent price jump has pushed VIRTUAL back above $2 and close to a critical resistance zone at $2.22. This level is more than just a psychological barrier — it also acts as the neckline of the cup-like pattern forming on the chart.
What makes this setup particularly compelling is the behavior of the Chaikin Money Flow (CMF) indicator. CMF measures buying and selling pressure by analyzing volume flow. A reading above zero suggests accumulation (buying), while below zero indicates distribution (selling).
In VIRTUAL’s case, CMF dipped toward the zero line during the recent pullback but failed to break below it. Instead, it bounced strongly — a sign that selling pressure did not overwhelm the market. This resilience implies that whales and institutional players may have used the dip as an accumulation opportunity.
If CMF holds above zero and continues to rise, it could confirm sustained institutional interest, paving the way for a breakout above $2.22. Such a move would validate the bullish cup pattern and potentially unlock gains toward **$3.00**.
On-Chain Data Reveals Surge in User Engagement
Beyond technicals, on-chain metrics are adding fuel to the bullish thesis. One of the most telling indicators is price-Daily Active Addresses (DAA) divergence — a metric that compares price movement with actual user activity on the network.
When price rises alongside increasing daily active addresses, it signals healthy growth: more people are using the network as value increases. But when price climbs while user activity stagnates or drops, it often precedes a reversal — a sign of speculative froth.
For VIRTUAL, the data tells a different story.
According to analytics platform Santiment, VIRTUAL’s price-DAA divergence has surged nearly 400% over the past week. This dramatic spike indicates that rising prices are being supported — even driven — by a significant uptick in real-world usage.
This kind of organic growth is rare among altcoins experiencing rapid price appreciation. It suggests that VIRTUAL isn’t just another pump-and-dump meme coin; instead, it may be gaining traction due to actual utility or ecosystem development.
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A sustained increase in active addresses could act as a foundation for long-term price appreciation, making any pullbacks more likely to be buying opportunities than warning signs.
Bullish Momentum Confirmed by Bull Bear Power Indicator
Zooming in on short-term dynamics, the Bull Bear Power (BBP) indicator provides further confirmation of bullish dominance.
BBP calculates the difference between the highest price of the day and the 13-day exponential moving average (EMA), helping traders assess whether bulls or bears are in control:
- Positive values = Bulls in charge
- Negative values = Bears taking over
Over recent sessions, BBP has consistently posted positive readings — illustrated by green histogram bars on the chart. This persistent strength suggests buyers are firmly in control and capable of defending key support levels.
Should this momentum continue, a breakout above $2.81** becomes increasingly likely. Once that resistance is cleared, the next major target lies at **$3.38, aligned with the 0.382 Fibonacci retracement level — a common area where pullbacks find support during strong trends.
However, technical analysis also demands caution.
A failure to break through $2.24** could invalidate the current bullish structure. In that scenario, profit-taking and short-term selling pressure might push VIRTUAL back down toward **$1.44, wiping out much of the recent gains.
That said, given the strength of on-chain fundamentals and CMF resilience, such a drop appears less probable unless broader market conditions shift dramatically.
Frequently Asked Questions (FAQ)
Q: What is Virtuals Protocol (VIRTUAL)?
A: Virtuals Protocol is a blockchain-based platform focused on digital identity, virtual asset management, and decentralized interactions in virtual environments. It aims to bridge real-world identity with Web3 applications through secure, privacy-preserving technology.
Q: Why did VIRTUAL drop below $2 recently?
A: The brief dip below $2 was likely due to profit-taking after a strong rally earlier in May 2025. Such corrections are common in fast-moving altcoin markets and often create buying opportunities for long-term investors.
Q: Is VIRTUAL’s price increase supported by fundamentals?
A: Yes. The 400% surge in price-DAA divergence shows rising network usage alongside price growth — a strong signal that adoption is keeping pace with speculation.
Q: What are the key resistance levels for VIRTUAL?
A: The immediate resistance is at $2.24. A breakout above this could lead to $2.81 and eventually $3.38. Failure to clear $2.24 may result in a retest of $1.44.
Q: How does Chaikin Money Flow affect VIRTUAL’s outlook?
A: CMF staying above zero indicates ongoing accumulation by smart money. As long as this trend continues, it supports further upside potential.
Q: Can VIRTUAL reach $3 in 2025?
A: Based on current momentum and technical patterns, a move toward $3 is plausible — especially if on-chain activity remains strong and broader crypto market sentiment stays positive.
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Final Outlook: Rally Still Intact
Despite a momentary stumble, Virtuals Protocol has shown resilience. The combination of a U-shaped recovery pattern, strong CMF readings, and explosive growth in daily active addresses paints a picture of an asset with both technical strength and growing fundamental support.
While resistance at $2.24 remains a hurdle, overcoming it could trigger a new wave of momentum toward $3 and potentially higher targets like $3.38.
For now, all signs point to the rally being far from over — but vigilance is key. Traders should monitor volume, CMF trends, and DAA data closely for early warnings of any shift in sentiment.
As always, invest responsibly and consider consulting a financial advisor before making decisions in volatile markets.
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