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Official Trump [$TRUMP] had made a fantastic bullish turnaround the previous week. The memecoin had rallied nearly 90% in five days, when the price went from $1.39 to $2.62 by Sunday, the 23rd of August.
Since then, it has seen a mild retracement but was still comfortably above the $2 mark.
Statements from U.S. President Donald Trump for Congress to pass the CLARITY Act and support for the U.S. to purchase substantial amounts of Bitcoin [BTC] had sent the crypto market sentiment into a bullish frenzy.
The altcoin market made a resounding rebound on the back of Bitcoin’s momentum, leading to talk of another altseason.
The $TRUMP team continued to distribute into strength, making a sale worth $3.39 million, adding to the selling pressure that pushed the token below $3.
Why a $TRUMP price dive below $2 is still likely
The bullish structure break (green) was the biggest highlight on the 1-day timeframe of the memecoin. This meant investors and swing traders can have positive price expectations, despite the heavy volatility during the previous weekend.
On Saturday, the 22nd of August, $TRUMP rallied to $3.68 but was forced to close that daily session at $2.38. This price action underlined intense profit-taking activity. The technical indicators also highlighted the same.
While the OBV made new highs, the CMF was at a firm bearish reading of -0.23. This incongruence can be explained by the severe volume that pulled prices far below the $3.68 high.
In other words, the volume was not inherently bearish, but the path ahead could be dangerous for the bulls.
The 1-day swing structure remained bullish. The 78.6% Fibonacci retracement level at $1.86 is likely to be tested now that $TRUMP prices have fallen below the 61.8% level at $2.24.
Expect a recovery, but be prepared to take profits
A price drop below $2 would likely allow swing traders to go long. The high volatility in recent days meant risk management would be key. It is unclear if profit-taking pressure has eased enough to allow another rally beyond $3.
Moreover, Bitcoin was grappling with the $83k supply zone and hasn’t claimed this area as a support zone. Until then, the threat of a sell-off would be in the back of investors’ minds.
A drop below $1.76 would be an early sign of bearish dominance. Until then, investors can think of a price dip below $2 as a feasible buying opportunity. Bearish trend confirmation would be at hand if $TRUMP prices fall below the $1.36 swing low.
Final Summary
- The $TRUMP memecoin volatility over the weekend has raised worries of intense profit-taking halting the uptrend.
- A drop toward $1.80-$1.90 is likely, but any further losses would begin to question $TRUMP bulls’ control of the market.
cryptopotato.com
coinpedia.org
