Mr. Donald Trump, who was elected President, introduced a new Token called OFFICIAL TRUMP (TRUMP). This cryptocurrency on the Solana platform has increased more than 180% and is currently trading at $18.61 at the time of writing.
However, on the hourly chart, there have been a series of bearish divergences, suggesting a possible trend reversal.
TRUMP’s Bearish Divergence Threatens Upward Momentum
The newly launched meme coin TRUMP has led the market as the biggest gainer in the past 24 hours. The spectacular rally took its market capitalization past $3 billion in less than 12 hours, earning it a spot in the top 100 cryptocurrencies. As of now, Donald Trump-related tokens are the 37th largest crypto asset by market capitalization.
However, despite the current attention on TRUMP, some bearish signals have emerged, calling into question the sustainability of the uptrend. TinTucBitcoin’s review of TRUMP’s hourly chart reveals a steady decline in its trading volume.
A bearish divergence occurs when the price of an asset increases but trading volume decreases. This divergence signals weakness in demand or reduced buyer participation, making the rally unsustainable.
This consideration suggests that TRUMP’s price rally may be driven mainly by fewer transactions or speculative activity, leaving the Meme Coin coin vulnerable to a potential reversal.
Furthermore, the steady decline in TRUMP’s Chaikin Money Flow (CMF) also reinforces this bearish outlook. Even though TRUMP price has increased, its CMF remains in a downtrend, forming a bearish divergence.
When the price of an asset is rising but its CMF is falling, this shows that buying pressure is falling sharply despite the rising price. This divergence suggests that the rally may lack solid support from the market, signaling a possible reversal.
TRUMP Price Forecast: Uptrend Faces Risk of Reversal
When buying pressure decreases, TRUMP’s uptrend will lose momentum. When selling begins, it will reverse the current trend and could drop to $14.85.
On the other hand, if the current trend is maintained, TRUMP will return to its all-time high of $19.39 and continue to set new highs.