Pump.fun loses KEY support as $5M liquidations raise PUMP’s downside risks
Key Summary
Pump.fun's price dropped 7.2% as $5.09 million in long positions were liquidated, triggering a cascade of liquidations and forcing traders to panic-close their positions. The altcoin's trading volume dropped 20% to $427 million, and its futures recorded $445 million in outflows compared to $418 million in inflows. The negative Netflow and strong spot selling pressure suggest that more capital flowed out of the futures market than entered it, potentially reflecting traders closing positions to cash out or avoid further losses.
Pump.fun Loses KEY Support as $5M Liquidations Raise PUMP’s Downside Risks
Market Analysis
Pump.fun's price drop pushed many bulls out of the market, with the altcoin's trading volume dropping 20% to $427 million. According to CoinGlass data, $5.09 million worth of long positions were liquidated, usually adding selling pressure to an already falling market. This can trigger a cascade of liquidations. In fact, this market behavior was widely observed over the past 24 hours. PUMP's futures recorded $445 million in outflows compared to $418 million in inflows. As a result, Futures Netflow dropped 98% to -$27 million. The negative Netflow suggested that more capital flowed out of the futures market than entered it, potentially reflecting traders closing positions to cash out or avoid further losses. On the Spot side, selling pressure was even more intense. According to Coinalyze data, the altcoin recorded 11.4 billion in Spot Sell Volume compared to 10.8 billion in Buy Volume. As a result, the Buy Sell Delta fell to 600 million, reflecting strong spot selling pressure. Exchange activity is also recorded for this selling activity, especially over a 12-hour timeframe. Over this period, PUMP saw $11.47 million in Spot inflows compared to $9.8 million in outflows. Moreover, Spot Netflow rose 148% to $1.6 million, a significant reversal from $1.6 the previous day.
Technical Analysis
Structurally, PUMP has been weakened by intense market pressure. Notably, the MACD formed a bearish crossover and dropped to 0.00005 as of writing. The crossover confirmed increasing selling pressure and strengthening downside momentum as buyers lost control. Likewise, the Stochastic Momentum Index (SMI) dropped to 22, reinforcing the bearish outlook. These indicators point to a strengthening downtrend and a potential continuation.
Conclusion
If the bearish pressure seen on the daily charts persists, we could see PUMP drop below $0.005 toward $0.0046. However, if reduced leverage eases market volatility, the altcoin could hold above $0.005 and potentially reclaim $0.006.
Author
Gladys Makena is a Cryptocurrency and Financial Analyst at AMBCrypto with four years of market analysis experience. Her quantitative expertise is supported by a strong background in Finance, providing a solid foundation for a data-driven approach. At AMBCrypto, Gladys is committed to providing the community with timely and insightful news, reports and technical analysis.