- BitTensor drops over 22% in a month, nearing the critical support zone.
- Declining funding rate signals reduced bullish sentiment among traders.
- Analysts eye bullish pennant pattern as potential signs of rebound.
The turbulence in the crypto market has caused several cryptos to lose their values, and the BitTensor price wasn’t an exception. Over the last month the token witnessed a bloodbath as its value plummeted by more than 22%. In fact, in the last seven days alone, the BitTensor (TAO) price dipped by 10%. This latest drop has pushed the BitTensor price near a critical support zone. Does this mean investors should expect a further decline, or is a trend reversal possible?
BitTensor Price—Checking where it stands
After the recent bearish trend, the TAO price was pushed down to $342.33, and its market capitalization shrunk to $3.34 billion, making it the 34th largest crypto. Latest data revealed that a key reason behind this downfall could be a lack of investor interest in the token. As per Coinglass’ data, BitTensor’s funding rate has been declining for quite a few days.
In crypto, a decline in the funding rate means the rate at which funding fees are paid between traders has decreased. A positive decline refers to a shift from a high positive rate to a lower positive rate or from a positive rate to a negative one. This typically signals a reduction in bullish market sentiment, as it implies fewer traders are willing to pay high premiums to hold long positions.
Our analysis of TAO’s daily price chart revealed that the recent plummet has dragged the BitTensor price down to a critical support zone, an area that often determines whether the asset can sustain its value or witness an even deeper fall.
At this stage, market participants are closely monitoring the token’s ability to hold above its current price range. A dip below this level could expose TAO to further downward pressure, potentially driving the price closer to the $307 mark in the coming days.
Adding to this bearish outlook, the Relative Strength Index (RSI), a key technical indicator that measures momentum, has also registered a downtick. This signals that selling pressure is intensifying, with sellers clearly outweighing buyers in the market.
Such a shift often indicates that bearish sentiment may continue to dominate unless a strong buying interest emerges. If bulls fail to step in soon, TAO might struggle to regain stability, leaving investors cautious about short-term recovery prospects.
Some remain optimistic
While the aforementioned datasets gave a bearish notion, quite a few crypto analysts continue to remain positive on the BitTensor price. For example, Yakuza, a popular analyst, recently posted on X.
As per the post, the BitTensor price has been moving inside a multi-month bullish pennant pattern. It was interesting to note that the pattern first emerged in May, and since then TAO’s price has been consolidating inside it. At press time, the token was testing the support of the pattern. In case of a successful test, Yakuza expects a price rebound towards $730.
Conclusion
To sum things up, BitTensor (TAO) faces a pivotal moment as it tests a critical support zone amid declining investor sentiment and growing selling pressure. While technical indicators suggest potential for further downside, some analysts remain hopeful about a bullish reversal. The coming days will be crucial in defining TAO’s short-term trajectory.
