• Worldcoin struggles to hold support at $1.00 as risk-off sentiment spreads.
• WLD liquidations surge and open interest extends its decline from July's peak.
• Sell signals offered by the MACD and SuperTrend indicators could suppress any short-term recovery.

Worldcoin (WLD) bulls are facing difficultly, attempting to prevent the previous day's sell-off, triggered by revived inflation concerns in the United States (US), from extending toward the range support at around $0.90. 

The token trades around $1.00 at the time of writing amid a significant slump in interest, evidenced by a shaky derivatives market. 

Worldcoin faces declining open interest as liquidations surge 

Worldcoin futures Open Interest (OI), which refers to the notional value of outstanding futures or options contracts, stands 38% below July's peak of $465 million. 

The steady decline to $287 million indicates that WLD faces low risk-on sentiment as fewer traders bet on the price rising in the short term. If this trend holds, WLD's recovery above the $1.00 level might be a pipe dream in the near term.

World Coin Futures Open Interest | Source: CoinGlass

The subsequent surge in liquidations amounting to $2.12 million over the past 24 hours, with long position holders bearing the biggest brunt at $2 million, underscores the bearish momentum. 

WLD futures liquidations data | Source: CoinGlass

Still, a bullish trend reversal could gain traction in upcoming sessions if the futures weighted funding rate stabilizes in the positive region. A positive funding rate suggests that more traders are leveraging long positions in the WLD, thus increasing the probability of a recovery occurring.

WLD Futures Weighted Funding Rate indicator | Source: CoinGlass

Technical outlook: Worldcoin on the cusp of extending decline 

Worldcoin price hangs at the edge of a cliff, with support at $1.00 seemingly weak due to the rampant risk-off sentiment in the broader cryptocurrency market. The token's position below key moving averages, including the 50-day Exponential Moving Average (EMA), the 100-day EMA and the 200-day EMA, all forming a confluence of support at $1.04, puts bulls at a disadvantage.

At the same time, the Moving Average Convergence Divergence (MACD) indicator dons a sell signal, calling on investors to consider de-risking from WLD as the downtrend extends toward the next key support at $0.90. WLD's bearish bias may hold with the blue MACD line remaining below the red signal line.

WLD/USDT daily chart

The Relative Strength Index (RSI), which is declining toward the oversold region, affirms the bearish grip amid a reduction in buying pressure. Traders should monitor support at $0.96, tested on Tuesday, and the lower demand zone at $0.90, tested on August 2. Strong rebounds from these levels could offer entry opportunities for investors who wish to buy the dip.