The Pi Network price has crashed over the past few weeks, erasing some of the gains it made in November. The token was trading at $0.2200 on Tuesday, down sharply from the September high of $0.2821. This article explores why the downtrend may continue in the coming days or weeks.
Pi Network Price Technicals Point to More Downside
The four-hour chart shows that the Pi Coin price has been in a strong bearish trend in the past few weeks, moving from a high of $0.2820 to the current $0.2200.
A closer look shows that the token has formed a head-and-shoulders pattern, a common bearish continuation sign in technical analysis. It is now along the neckline of this pattern.
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Pi Coin price has moved below the 50-period and 25-period Exponential Moving Averages (EMA), while the Relative Strength Index (RSI) and the Percentage Price Oscillator (PPO) have continued moving downwards. It has moved to the Ultimate Support level of the Murrey Math Lines.
Therefore, the most likely scenario is that the Pi Coin price continues to fall as sellers target the extreme oversold level at $0.2075, the Murrey Math Lines’ extreme oversold level. This price is about 10% below the current level.
Pi Coin Facing Major Headwinds
The bearish Pi Network price forecast comes amid key headwinds. First, the network will unlock over 150 million tokens this month and 1.21 billion in the next 12 months. The average monthly unlocks will be 18.7 million, which is equivalent to $4.14 million. More token unlocks will increase supply, potentially dampening its price.
Second, Pi Network’s SocialChain recently received a lawsuit by an American disgruntled investor who accused it of being a scam. The suit argued that the network overpromised and underdelivered. For example, the plaintiff argued that the developers stated Pi would be decentralized, while in fact they continue to control the nodes.
Additionally, Pi’s demand has slumped on Wall Street, with data showing that 24-hour volume fell 13% to $14.3 million, a tiny amount for a cryptocurrency with a market capitalization of over $1.84 billion. Most of this volume was on OKX and Bitget.
Pi Network price has other major headwinds, including the ongoing crypto market crash, which may continue after the Federal Reserve slashes interest rates on Wednesday. As we have written before, this cut may lead to further downside in crypto, as market participants have already priced it in.
Pi Network is still a ghost chain with no ecosystem, making it hard to justify the current $1.84 billion market cap. While the developers have made some efforts to boost the ecosystem, including with the CiDi Games investment, the impact on the ecosystem growth is yet to be seen.
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