The Trump Coin price crashed below a crucial support level, continuing a trend that started before the VIP dinner. TRUMP token plunged to a low of $11.9, its lowest level since May 8. This article explains some of the top reasons why the meme coin has plunged after the VIP dinner.
Why the Trump Coin Price Has Crashed
There are four key reasons why the Trump Coin price has plunged in the past few days. First, it fell because of a concept known as buying the rumor and selling the news. This is a situation where investors purchase an asset before a major event and then sell it when it occurs.
In the Trump Coin case, the token surged by 120% from its lowest point in May and its highest level in May as traders anticipated the dinner. It then started falling towards the dinner as those who had missed their slot began selling their coins.
Many of the dinner’s participants have also started selling their coins since they have achieved their goal of meeting the US president.
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Second, the ongoing crypto crash has also contributed to its sell-off. The Bitcoin price has plummeted from a record high of $111,900 last week to below $107,000 today. Similarly, the market cap of all Solana meme coins has plunged from $15 billion last week to the current $12.1 billion. Cryptocurrencies are often highly correlated with each other.
Third, Jamie Raskin, a top Democrat, has announced that he will launch an investigation into the Trump dinner. Many ethics experts believe that the dinner was unethical and a form of corruption, as it enabled foreigners to give money to the US president.
Trump Meme Coin Price Technical Analysis
Finally, the Trump Coin has declined due to technical issues. The chart above shows that the token formed a triple-top pattern at $15.80 and a neckline at $10.40. A triple-top is one of the most popular bearish reversal chart patterns in technical analysis.
It has now moved below the key support level at $12.17, a level it has resisted moving below since March 12. Moving below that level is a sign that bears have prevailed. It has also moved below the 50-day moving average.
Therefore, the coin is likely to continue falling as sellers target the neckline at $10.40, which is 13% below the current level. A move below that level will signal further downside, potentially to the April low of $7.2, which is 40% below the current level.
