THORChain (RUNE) Price Shows Growth, but Bearish Signals Loom Large

THORChain (RUNE) Price Shows Growth, but Bearish Signals Loom Large

Despite some recent growth in THORChain’s (RUNE) price over the past 24 hours, the overall outlook remains uncertain, with bearish indicators suggesting that the upward momentum might not be sustainable.

THORChain Could Be in Need of a Major Catalyst

The recent rise in RUNE’s price may struggle to overcome the prevailing bearish signals currently observed in the market. Notably, the altcoin’s Chaikin Money Flow (CMF) indicator has shown a persistent trend of capital outflows over the past five months. This ongoing pattern has led to the formation of a downtrend on the indicator, reflecting a prevailing bearish sentiment among RUNE investors. Although this downtrend line has been breached, the key question is whether RUNE can maintain its position above it.

Furthermore, the funding rate for RUNE has seen a decrease in optimism over the last two weeks. Since the start of the month, the altcoin has experienced periods of negative funding rates, indicating that short positions have been dominating the market during these times.

The frequent shifts to negative funding rates point to weakening market confidence and enthusiasm, potentially exacerbating the difficulties in RUNE’s recovery.

Together, these factors present a challenging short-term outlook for RUNE. Overall, the current market conditions indicate that RUNE is facing significant headwinds.

RUNE Price Prediction: A Difficult Path Ahead

Over the past nine months, RUNE’s price has formed a macro head-and-shoulders pattern, a classic bearish setup. This pattern was confirmed in early June when the altcoin dropped below the crucial breakdown level of $4.82.

Currently, RUNE is trading at $3.68 after bouncing off the support at $2.94. While the broader market’s bullish sentiment is helping to prevent a sharp decline, RUNE remains vulnerable within this pattern.

The head-and-shoulders formation suggests that a significant drawdown of up to 93% could occur, potentially pushing RUNE towards its all-time low of $0.33.

However, this bearish outlook would be invalidated if RUNE manages to break above the $4.82 resistance level, which could open the door to further gains for the altcoin.