Rocket Pool (RPL) has soared more than 20% in the last 24 hours. However, this has been seen to lead to a sell-off by the major investors due to the high-valued gains.

Specifically, 1kxnetwork, a firm that invested in Rocket Pool early on, recently transferred large amount of RPL tokens to Binance. This led to speculation on the future price of the token and whether retail investors should follow the same path.

As per on-chain data, the said transfer by 1kxnetwork amounted to 203,320 RPL tokens worth $2.37 million to Binance. This move was made possible after Rocket Pool’s price rallied by 22% following the introduction of perpetual contracts for RPL on Binance.

The firm has been offloading RPL since the end of August up to the current period, indicating that the early investors are cashing in on their gains. They bought 500,000 RPL for $2. 1kxnetwork has sent 313,739 RPL to Binance since August 29, 2024.

Though the firm has sold many RPL tokens, 1kxnetwork still controls 315,835 tokens, with about $3.62 million staked. This holds a stake in Rocket Pool, meaning that even though they are taking profits, they believe in the project for the future.

Rocket Pool Price Surge: What’s Behind It?

The 22% surge in Rocket Pool’s price in the last week was triggered by Binance integrating perpetual contracts for RPL. This allowed traders to enter into a contract with a predetermined token price.

This news boosted the morale of the traders and caused a price hike. It saw RPL soaring to its recent high of $12.25. When writing this article, Rocket Pool has a market capitalization of $222.27 million and a total supply of 20.

It is ranked 301 with a market capitalization of 7 million RPL. The daily trading volume is now at $23 million. Nevertheless, Rocket Pool has a strong foundation due to the retracement.

The TVL in the protocol stood at $2.95 billion as of the writing of this piece. This shows that the project is vital in the Ethereum staking market.

Price Consolidation: What the Charts Say

Looking at RPL’s price charts, we see fluctuations in the past hour. After the rapid rise in its price, RPL has been trading in a consolidation mode, oscillating between $11 and $12.

This pattern usually indicates that the market is resting after a strong bullish rise when buyers and sellers are measuring the further course of the market.

1-hour RPL/USDT Chart | Source: TradingView

However, according to recent data, the price of RPL has started to decline again, currently at $10.70 on Binance. From the 1-hour price action chart, the Relative Strength Index (RSI) is 30.24. This is close to the oversold region, indicating that the token is almost oversold.

This means that, while RPL may well be due to rebound in the short term, the fact that the RSI is moving lower indicates that the sellers remain in control. The steep drop from its intraday high suggests that the short-term traders who shirted the rally are now using stop losses to exit the position similar to 1kxnetwork.

It is difficult to state whether this is the beginning of a more extended correction or a standard retracement after a strong, bullish move.