The PI Coin has gone through a turbulent period since the launch of its mainnet last week. After the launch, the altcoin experienced a massive plunge, losing 99% of its value in just 4 days.
There are signs of recovery, but the damage is still significant. The token is struggling to regain the lost value.
PI Coin Faces Challenges
The Chaikin Money Flow (CMF) indicator showed dramatic fluctuations in the market sentiment of the PI Coin last week. After the mainnet launch, investors engaged in massive sell-offs, causing the CMF to decline. However, other investors rushed in, taking advantage of the low prices, leading to a sharp increase in inflows.
This is clearly reflected in the indicator's sharp rise. Despite this inflow, true confirmation of the uptrend will occur when the CMF crosses above the 0 line. This suggests a sustained positive momentum and investor confidence in the recovery of the PI Coin.
The recovery of the PI Coin is still in the early stages, and the market sentiment is sending mixed signals. The inflows indicate that some investors believe in the potential of the altcoin. However, the inability of the indicator to consistently stay above the 0 line suggests that the upward momentum is not yet fully established. Sustained buying pressure is needed for the price to build momentum and stabilize investor confidence.
The PI Coin is also facing strong macroeconomic headwinds in the form of a bearish crossover. The Moving Average Convergence Divergence (MACD) has observed a bearish crossover in the last 36 hours. This typically signals the expectation of further downward price movements.
The market is under pressure, and the price movements of the PI Coin reflect this broader trend. However, if the gradual recovery continues, and the PI Coin manages to generate stronger interest among investors to increase inflows, the altcoin may witness a bullish crossover. This would indicate a potential recovery, as confirmed by the histogram bars crossing above the neutral line.
PI Coin Price Recovery May Take Time
At the time of writing, the PI Coin has rebounded by 116% over the weekend, trading at $1.56. Despite this short-term recovery, the prevailing bearish signals suggest the possibility of further declines. The altcoin has reached an all-time high (ATH) of $1.72, but it is closer to the support level of $1.43.
Considering the current market outlook and technical indicators, there is a high likelihood that it will soon break through this support level and slide towards the $1.19 support. Otherwise, the altcoin may enter a correction below the $1.72 ATH, facing sustained downward pressure due to the bearish crossover and the broader market negativity.
For the PI Coin to truly break through, it will require stronger support from investors. It needs to surpass the $1.72 barrier and consistently form new ATHs above $2.00. This would be a crucial turning point that would invalidate the current bearish outlook.
