Pi Network's token continues to underperform, showing a sideways trend despite the cryptocurrency market's upward movement.
While the market rose last week and several assets reached all-time highs, with others reaching their highest levels in months, PI remained within a narrow range. With a sharp decline in interest in altcoins, there is almost no momentum to break out of this narrow range.
PI Trades Sideways…Decreased On-Chain Activity Reduces Investor Interest
Currently trapped in a sideways trend, PI faces strong resistance at $0.46 and a firm support level at $0.43. Unlike other assets riding a new wave of investor enthusiasm, PI is seeing decreased trading interest due to a sharp drop in on-chain trading volume.
According to Santiment, a cryptocurrency online data platform, the volume has decreased by 21% over the past 7 days, indicating reduced demand and growing investor caution.
The volume decrease means fewer investors are buying or selling the asset. This suggests decreased interest, reduced liquidity, or general market uncertainty.
When such a situation occurs during a sideways trend like PI's, it indicates a lack of strong conviction. The momentum is stagnant as buyers and sellers do not dominate.
Additionally, according to PiScan data, the Pi Network is set to unlock 95 million PI tokens in the next 8 days, which will add downward pressure on the token.
With traders already cautious amid continuous price stagnation and volume decrease, the token unlock could either reinforce PI's price stagnation or trigger a breakdown below the $0.43 support. This is because such a large token influx increases selling pressure, especially during a downtrend where demand is too weak to absorb additional supply.
PI Downtrend Intensifies…$0.43 Support Level Draws Attention
Evaluating the Elder-Ray indicator on PI's daily chart confirmed a downward slope in market sentiment. This indicator, which measures the strength of buyers and sellers in the market, has been recording negative values since July 12, indicating a strong downtrend.
If the current trend continues, the likelihood of breaking below the $0.43 support level increases, potentially opening the door to retesting PI's all-time low of $0.40.
However, if buying interest increases anew, the momentum could reverse. With demand recovery, the PI token price could potentially overcome the $0.46 resistance and rise towards $0.50.
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