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Key Insights:
- With a 13% price drop since launch, Pump.fun (PUMP) has fallen below its ICO price.
- The potential reason behind the fall is a $39.6 million profit-taking by early investors.
- A significant $2.11 million worth of PUMP has flowed out of exchanges, signaling possible accumulation.
The recently launched Pump.fun (PUMP) appears to be in trouble due to its poor performance. With a 13% price dip in the past 24 hours, PUMP has fallen to $0.003750, hitting an intraday low of $0.003620.
PUMP Price and Trading Volume Surge
This is the same level at which Pump.fun was offered during its Initial Coin Offering (ICO), as revealed by the blockchain-based transaction tracker Whale Insiders.
The potential reason behind this drop is ongoing profit booking. CoinMarketCap data reveals that early investors have booked profits worth $39.6 million.
Amid this, participation from traders and investors has skyrocketed. PUMP’s 24-hour trading volume has surged by 35% compared to the previous day.
Market Sentiment
Some see this drop as an opportunity, while others appear to be offloading their holdings out of fear. The question now is: will the price recover or collapse in the coming days?
Given the current market sentiment, several posts on X (formerly Twitter) have surfaced; some users claim they have purchased, while others appear to be frustrated.
In a post on X, a crypto expert called PUMP a “generational fumble” and sarcastically suggested that “$0 is a good place to bid.” This post highlights the growing frustration among investors amid the steep decline.
Mixed On-Chain Metrics
On-chain analytics firm CoinGlass reveals that, after a continuous inflow of tokens over the past week, a record outflow of $2.11 million has been recorded in the past 24 hours for the first time.
This substantial outflow of tokens hints at potential accumulation and may help reduce the ongoing selling pressure. However, traders are still following the bearish trend. CoinGlass data reveals that traders are strongly betting on short positions.
At present, the major liquidation level on the lower side is $0.00356, where traders have built $1.40 million worth of long positions. $0.000398 is another major liquidation level, where traders have built $45.64 million worth of short positions.
In addition, PUMP’s long/short ratio currently stands at 0.8723, indicating a strong bearish sentiment among traders. Given the current market sentiment, 46.59% of traders are betting on long positions, whereas 53.41% are on the short side.
It shows that market sentiment in the short term is still bearish, whereas in the long term, it may see a recovery if the outflow continues.
Pump.fun (PUMP) Price Action and Key Technical Levels
According to expert technical analysis, PUMP is in a downtrend, unlike the overall market. Based on the recent price action, PUMP has formed a falling wedge pattern between the upper and lower boundaries on the four-hour timeframe.
However, the price has recently fallen from the upper boundary. It is heading towards the lower boundary, which appears to be at $0.00325 or lower.
This suggests that PUMP may face a price decline in the coming days. However, the trend could only shift if PUMP breaks out of this falling wedge pattern.
At present, the asset’s Relative Strength Index (RSI) stands at 32, indicating that it is in oversold territory. So, it may experience a price reversal or upward momentum.
Disclaimer
This article is for informational purposes only and provides no financial, investment, or other advice. The author or any people mentioned in this article are not responsible for any financial loss that may occur from investing in or trading. Please do your research before making any financial decisions.
