ID token recently played out a typical scenario of sharp gains followed by pullbacks — surging over 28% in 24 hours before quickly retracing, with the driving force gradually losing momentum. How should we interpret this price action?

From a technical perspective, the current situation is somewhat mixed. On one hand, the 7-day, 25-day, and 99-day exponential moving averages maintain a bullish alignment, with short-term MAs firmly positioned above long-term MAs, suggesting upside momentum hasn't completely dissipated. On the other hand, the MACD has broken below the signal line with negative histogram bars, and the Relative Strength Index has surged into extreme overbought territory — all signaling that correction pressure is accumulating.

Changes in fund flows warrant attention. After price topped at 0.0949 USD, trading volume began contracting, and most critically, recent capital flow data shows total inflows have turned negative, indicating weakening buying pressure and increasing selling pressure.

However, don't be overly pessimistic. Web3 identity and account abstraction concepts have recently regained traction, with market attention heating up; simultaneously, US inflation data has dropped to 1.88%, raising the likelihood of central bank rate cuts, which actually provides a positive backdrop for risk assets.

Overall, ID token stands at a critical crossroads — short-term technicals indeed signal overheating signals, but the macro environment and market sentiment still provide support. The key question is whether it can hold critical support levels.