The price performance of Pi Network over the past few weeks has generally been quite lackluster. Despite some attempts to rise, it has failed to maintain any significant momentum. As August approaches, this altcoin faces additional pressure from a large token unlock that could further weaken the already fragile market structure.
156 Million PI Tokens Preparing to 'Flood' the Market
Pi will have a large token unlock event in August. According to data from PiScan, approximately 156 million tokens (equivalent to about 68 million dollars at current prices) will be unlocked over the course of 31 days.
This event significantly increases the bearish risk for a token that is already under considerable pressure, while demand from buyers is nearly insufficient to support any recovery.
Currently trading at 0.42 dollars, PI is not keeping up with the overall growth of the crypto market, where many assets have reached new all-time highs. This altcoin is under heavy supply pressure, with over 250 million tokens entering circulation this month alone.
With buying demand almost insufficient to balance this massive supply, PI is unable to create stable upward momentum.
The price is currently 'held' in a narrow and dangerously fluctuating range near the historical low of 0.4 dollars.
A Gloomy August Awaits PI as Buying Demand Gradually Disappears
Data from the daily chart shows that technical indicators are all signaling a bearish trend, with no clear signs of a reversal. For example, the Accumulation/Distribution (A/D) indicator – a measure of buying/selling volume – of PI has been continuously declining since June 26.
The A/D index is currently at -1.01 million, down over 85% since the end of June – indicating that investor interest is increasingly weakening.
When an asset has an A/D line that is plummeting like this, it means that selling volume far exceeds buying volume. This trend reflects a continuously decreasing demand for PI, while signaling further bearish risks in August.
Additionally, after a failed attempt to break the neutral threshold of 50 on July 22, PI's RSI has begun a downward trend. Currently, the RSI is at 38.92, clearly reflecting the strength of the selling pressure in the PI spot market.
The RSI index measures the overbought or oversold condition of an asset, ranging from 0 to 100. A value above 70 indicates that the asset is overbought, posing a risk of a price drop. Conversely, a value below 30 indicates that the asset is oversold, and may soon recover.
With a reading of 38.92 and continuing to decrease, PI's RSI signals that the bearish momentum is intensifying as August approaches. This suggests that the token could continue to plummet if a reversal signal does not appear soon.
Can PI Survive the 68 Million USD Supply Wave in August?
If there is not enough new demand to absorb the 156 million PI tokens set to be unlocked next month, this altcoin could plummet to the historical low of 0.4 dollars. If the downward trend continues, a breakdown is entirely possible.
However, in the event that the current trend reverses and buyers return to the market, it could help stabilize PI's price in August, while creating an opportunity to break through the resistance level of 0.46 dollars.