The 95% Rebound of Pi Network Raises New Concerns
The price of Pi (PI), the cryptocurrency of the “tap-to-earn” mining app Pi Network, has experienced a significant rebound in recent weeks. After hitting a low of $0.3979 on April 7, the price surged to $0.785 on Monday, its highest level since late March. An impressive increase of 95% from its low.
This recovery follows a period of sharp decline as many pioneers (users who mined the token before the mainnet launch in April) began selling off their tokens. The price had also suffered from the lack of listings on centralized exchanges and persistent concerns about token dilution.
As shown in the chart below, over 1.56 billion tokens will be unlocked in the next 12 months, which could heighten pressure on the price.
A Troubling Pattern Emerges on the Chart : Analysis
The technical analysis of Pi Network’s price also raises concerns. After forming a bearish “wedge,” the token has now traced a bullish “wedge,” a chart pattern considered reliable for signaling a downward trend.
Furthermore, a “bearish divergence” appears to be forming, with the Percentage Price Oscillator (PPO) on the verge of generating a bearish signal and the Relative Strength Index (RSI) trending downwards.
These technical signals suggest a high risk of a sharp correction for Pi Network. The next key support would be around $0.3979, representing a potential drop of 47% from current levels.
However, this bearish scenario would be invalidated if the price managed to surpass the Woodie pivot at $0.8610. In that case, the next resistance would be at the symbolic level of $1, offering a potential increase of 32%.
On the other hand, PI has broken above its 4H Ichimoku cloud and its stochastic RSI is at its lowest, indicating a short-term upward movement is possible. However, the CMF remains close to the negative zone, indicating the need for caution and that the downtrend is not yet over for PI.
While the recent price rebound of Pi Network has given hope to many users, crypto experts caution against a likely fall. With a potential drop of nearly 50% from current levels.
In summary, key levels to watch are:
- the major resistance at $0.86 which could reignite the bullish trend
- the supports at $0.61 and $0.54 must hold, or it will drop towards $0.39 or lower.
Investors are therefore urged to exercise caution on this project, waiting to see if the price can sustainably break through key resistance levels. The token dilution also remains a major challenge to keep an eye on in the coming months.
