Cryptocurrency Analyst Warns of Potential Drop Below $0.30 Amid Optimism

Positivity in the market is displaying signs of weakness as a head-and-shoulders pattern suggests a possible significant downturn. At the time of reporting, the digital asset was priced at $1.16, showing a 3.54% increase over the last day.

However, experts are cautioning that a more profound drop could be looming on the horizon.

If the current bearish trend continues, the asset could see a decline below $0.30, representing a considerable drop from its previous peaks.

Negative Reversal Formation Indicates Challenges Ahead for the Digital Asset

An analysis of the technical aspects reveals a distinct head-and-shoulders structure, often indicating the conclusion of an upward trend. The left shoulder was formed in the early months of 2023, where the price reached approximately $3.70—$3.80.

The head was then formed from late 2023 to early 2024, with the price hitting highs of $4.90—$5.00. Subsequently, the right shoulder emerged in mid-2024, but the price failed to exceed $3.00, signaling diminishing bullish momentum.

The crucial support level at $1.40 provided robust backing until it was breached. Following this breach, the digital asset experienced a steep decline to its current value, confirming the bearish trend.

If this pattern unfolds completely, further downward movement is anticipated, with potential support levels identified at $0.70, $0.50, $0.38, and even $0.28 — $0.30 according to analysts.

Experts have issued warnings that a failure to sustain levels above $0.70 could lead to a swift drop towards $0.30, or possibly even lower.

Market Trends Indicate Weakening Demand for the Digital Asset

Data from IntoTheBlock regarding addresses presents mixed signals concerning user involvement. While the number of New Addresses (NA) surged by 27.28%, indicating increasing interest in the digital asset, the count of Active Addresses (AA) saw a decline of 19.56%, implying reduced user engagement in transactions.

Correspondingly, the decrease in Zero Balance Addresses (ZBA) by 18.88% suggests that fewer wallets are either being emptied or abandoned.

These insights reflect a troubling pattern as a surge in new addresses may not necessarily translate into sustained ownership or heightened market activity.

Reduction in Large Transactions as Institutional Engagement Slows Down

Transaction data reveals a reduction in significant trades, signaling decreased participation from institutional investors or major holders. Over the last three months, the volume of large transactions has varied between 500 and 1,500 per day.

On February 8, 2025, the transactions peaked at 942, while the lowest count within seven days was recorded on February 12, 2025, at 367 transactions.

Within the last 24 hours, 447 substantial transactions were registered, indicating a decline from recent peaks.

The digital asset’s price remains under strain, currently fluctuating around $1.00 — $1.16, aligning with the diminishing transaction volume.

A downtrend in substantial transaction activity could indicate a lack of confidence among major investors.

Future Prospects for the Digital Asset

The state of positivity is currently at a pivotal juncture, with traders closely monitoring its support levels. In the event of the asset failing to sustain $0.70, the subsequent downside targets include $0.50, $0.38, and ultimately $0.28 — $0.30.

Experts propose that a breach below $1.00 might expedite the decline. Nevertheless, reclaiming $1.40 could potentially invalidate the pessimistic scenario.