- Monad (MON) price has dropped by around 5% on a daily chart due to heavy selling pressure, declining its value to around $0.03099.
- The cryptocurrency’s price is currently in oversold territory, which might help it to see a reversal from the current point.
- The drop comes after significant selling pressure and strategic capital rotation by large-scale investors.
On April 24, Monad (MON) price experienced a marginal drop of 5% on a daily chart following profit-taking and capital rotation into other cryptocurrencies like Bitcoin.
As of now, the Monad MON-2.21% is currently trading at around $0.03099 with a drop of 4.72%. According to CoinMarketCap, the cryptocurrency currently holds a market capitalization of around $366.5 million with a daily trading volume of around $76.35 million.
This recent decline is very different from the strong performance the asset showed in the last 30 days. During that period, the token has gained more than 24% in total value. The daily trading volume soared by around 27%. This suggests that the currency sell-off is not related to the extreme panic, which is generally seen in major market crashes.
The token is now testing a critical support level around the $0.028 mark. Traders are expecting that the price will stabilize before any further losses happen.
Monad Faces Bearish Pattern After Failed Break
There are many major reasons behind this sudden price drop. These include major selling pressure and strategic capital rotation by large-scale investors. Many traders are now taking profits after the token reached its recent local highs during the mid-April rally. This selling pressure is being made worse by a rotation of capital into more stable assets like Bitcoin.
The overall crypto market is facing a period of extreme fear. The Fear and Greed Index is currently around 44.
There is no immediate positive factor for the cryptocurrency, which has made it hard for the token to maintain its upward momentum against these macroeconomic downfalls.
Also, the overall mood in the decentralized finance sector has become cautious for such cryptocurrencies. This comes after a security breach in a related protocol. This has led many people to reduce their investment in newer Layer 1 blockchains.
According to TradingView’s price chart, Monad is following a bearish consolidation pattern. This comes after the token failed to break through a major resistance zone located between $0.035 and $0.041. The Relative Strength Index (RSI) for the 14-day period recently hovered around 33, which suggests that the cryptocurrency is approaching oversold territory.
Current technical indicators show that the price is trading below both the 50-day and the 200-day Simple Moving Averages. This confirms a short-term bearish trend for the Monad.
Despite the price drop in the native cryptocurrency, the Monad ecosystem is continuously showing signs of long-term growth with new developments on the network. This is happening through various updates and partnerships. The development has recently released version 0.14.1 of the protocol. This release introduced a major RPC fix for transaction filing. The main purpose of this development is to improve gas estimation along with the overall user experience.
Another major development is the planned integration of the Portal stablecoin infrastructure. This is expected to provide native and efficient payment solutions across the entire mainnet. These upgrades are part of the Monad Momentum Wave 2 initiative. This initiative is designed to fund and speed up the growth of decentralized applications on the platform.
The Monad blockchain has climbed into the 10 rankings for decentralized exchange spot trading volume. This shows that it is gaining more adoption among traders. However, the DeFi sector within the ecosystem recently faced a major catastrophic event like Kelp DAO hack.
This was due to the Kelp DAO hack incident, which resulted in a loss of $292 million. Although the Monad protocol itself was not compromised, the exploit of rsETH assets created a wave of bad debt concerns and heavy withdrawals across multiple lending markets. However, Aave rolled out the DeFi United program to cover this debt.
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