Pi Network Coin price has crashed and is now hovering near its record low of $0.3350. It has plummeted by 90% from its all-time high, making it one of the worst-performing tokens in the crypto market. This article explores whether its crash will continue or whether a rebound is coming.
The Bearish Case for Pi Network Coin Price
A highly bearish case can be made on the Pi coin value. First, volume data show that demand has largely evaporated at a time when its supply is increasing by the day. Pi had a 24-hour trading volume of $71.6 million, significantly lower than that of other comparable tokens.
Second, Pi Network is highly dilutive, with over 1.22 billion tokens expected to enter circulation in the next 12 months. The average monthly increase is 32 million Pi tokens. As such, an increasing supply and falling demand often lead to more downward pressure over time.
Third, Pi is a highly concentrated token, with the unaudited foundation holding over 90 billion tokens. There is a risk that it may dump the tokens, leading to a potential crash.
Further, Pi Network is largely a ghost chain with no mainstream applications in the network. This is unlike what pioneers were promised during the enclosed mainnet era. The promise was that Pi Coin would be a better coin compared to Bitcoin.
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The Bullish Case for Pi Coin Price
While Pi Network price faces many headwinds, a bullish case can be made. The chart below shows that it has formed some highly bullish chart patterns.
Pi has formed a double-bottom pattern at $0.400, a popular bullish reversal sign. It has also formed a falling wedge pattern, which is made up of two descending and converging trendlines.
Pi is also in the accumulation phase of the Wyckoff Theory. This pattern is characterized by low volume and volatility. Therefore, if these patterns work out, there is a likelihood that the token will have a strong bullish breakout, potentially to the resistance level at $1, up by over 150% from its current level.
Pi Network price chart | Source: TradingView
Another bullish catalyst for the Pi Coin price is the slim chance that it will be listed by a major cryptocurrency exchange, which would instantly push its value much higher.
Finally, sentiment surrounding Pi Network is highly negative due to its weak performance and the issues surrounding its token unlocks. One of Warren Buffett’s most famous quotes is to buy when the market is fearful and sell when it is excited about an asset.
It is common for some hated assets like AMC, GameStop, and Clover Health to surge, albeit briefly. This could happen with Pi Network, especially if there is a catalyst.
The Bottom Line
The case for or against investing in Pi Network can be made as this report has demonstrated. While each side has merit, the most ideal situation is to go long as the coin has a high possibility of going parabolic if there is a catalyst.
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