The Jupiter digital asset seems to be facing challenges in the current market environment. Over the past two weeks, its value has decreased by 26%, while trading volume has dropped by 18% in the last 24 hours, indicating a prevailing bearish sentiment.
Despite being in an attractive demand zone, the Solana-based liquidity aggregator has not been able to attract significant interest from buyers recently. The question now is whether the bullish momentum will overpower the current selling pressure or if further decline is imminent.
Potential breakdown of the 78.6% retracement level
The recent market structure indicates a bearish trend on the daily chart. Jupiter appeared to establish a range between $0.736 and $0.913, but recent trading days have seen it fall below the established lows.
The zone between $0.69 and $0.78 has served as a significant demand area since April, being tested multiple times. Furthermore, breaching the 78.6% Fibonacci retracement level at $0.76 has occurred on several occasions.
If the price drops below the August 5th lows at $0.658, it could signal a further decline to $0.47. The On-Balance Volume (OBV) has been gradually decreasing over the past six weeks, indicating a lack of buying interest. Additionally, the daily Relative Strength Index (RSI) sits at 40, reflecting a bearish trend.
Potential bullish reversal opportunity for Jupiter below the retracement level
While typical market behavior suggests targeting the 100% retracement level after breaching the 78.6% mark, Jupiter’s situation may differ in this case.
This is due to a substantial accumulation of liquidity around $0.6 throughout the last three months. A decline to this level to absorb liquidity could result in a swift price recovery for JUP.
Disclaimer: The views expressed in this article are personal opinions and do not constitute financial advice or recommendations for trading or investing