PAAL AI (PAAL), a Telegram coin developed on the Ethereum blockchain, has seen its price drop by 10% in 24 hours. At the time of writing, it is trading at $0.19.
The price is down 77.50% from its all-time high in March. This on-chain analysis looks at the reasons behind the recent drop and what the next move could be.
Crypto Whales Abandon PAAL AI
According to BeInCrypto’s research, PAAL has been under significant selling pressure due to the decision of one of its key stakeholders. The investors involved in this decline are whales, a key group whose actions and inactions can have a significant impact on the price.
According to IntoTheBlock, PAAL AI Net flows for large holders have fallen 72% over the past seven days. And this has been the case for the last 30 to 90 days. The net flow of large holders is the following difference. Inflow and outflow.
If this gap increases, it means that whales are accumulating more coins than they are distributing. In most cases, an increase in coins purchased is a sign of a rising price.
However, in this regard, the net minus suggests that the distribution is higher. As in the case of PAAL, the price has expanded the losses.
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If crypto whales continue to liquidate their PAAL stakes, the price could continue to decline. Beyond this selling pressure, Santiment’s on-chain data shows that the project’s network growth has slowed significantly.
Network growth measures the number of new addresses interacting with a cryptocurrency for the first time.
An increase in this number indicates an influx of new participants making successful first transactions. However, a decrease suggests a point of decline due to lack of traction and lack of adoption.
In the case of PAAL AI, the recent decline means that the cryptocurrency is currently lacking the demand needed to recover its price. If this continues, as mentioned earlier, the price of PAAL may fall again.
PAAL Price Prediction: The Coin Struggle Continues
On the daily chart, PAAL has formed a rounding top pattern. Also known as an inverse rounding bottom, this pattern is characterized by an initial uptrend, after which the rally loses momentum and prices turn lower.
Often, a bearish confirmation occurs when the price breaks below the neckline shown on the chart. In the chart below, the neckline for PAAL is $0.1965. However, the price breaks below that area, suggesting that the downtrend could be next.
This bias is further reinforced by the Bull Bear Power (BBP), an indicator used to measure the strength of buyers over sellers. Generally, when BBP is positive, bulls are in control and prices are likely to rise.
However, the indicator reading for PAAL is negative, suggesting that the bears may push the price lower. In this case, the price of PAAL may fall to $0.1724, but if the bulls fail to defend this area, it may fall to $0.1499.
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Conversely, if whale accumulation and buying volume increases in the spot market, the cryptocurrency price may reverse upwards. In this case, PAAL may retest $0.2037. If it continues, the price may expand to $0.2462.
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