Pi Coin Near Breakout With Sentiment Growing

Pi Coin (PI) may have just completed a pre-breakout consolidation phase.
The altcoin has bottomed out after a two-month downtrend. Pi Coin comes at a potentially favourable time, with improving market sentiment and a possible altcoin season on the horizon.

Keypoints

• Pi Coin recently touched bottom after a two-month downtrend.
• Market sentiment is improving.
• A signal from the Bollinger Bands suggests an imminent surge in volatility.

Pi Coin's technical chart presents a bullish configuration. At the time of writing, the altcoin is trading at $0.47. Traders seem to be leaning towards long positions after a sideways consolidation phase, which has created a support base.

One of the most interesting technical aspects developing in the Pi Coin chart is the convergence of Bollinger Bands. This indicator measures volatility, i.e. how far prices move away from the moving average over a given period. The closer the bands are, the lower the volatility. The opposite happens when the bands widen - and the potential for volatility increases.

Interestingly, a similar contraction of Bollinger Bands also occurred in May, before a 114% surge in the price of Pi Coin. A repeat is not guaranteed, but in the current context it certainly seems more plausible. The entire crypto market is showing signs of a rise. Ethereum leads the altcoin charge, and Bitcoin is also in good shape. The conditions are favourable for a bullish breakout in the short term.

Signals of Capital Inflow on Pi Coin

It is important to note that investor sentiment towards Pi Coin is also growing. This is evidenced by the Chaikin Money Flow (CMF) indicator, which shows a bullish bias. CMF measures the amount of capital flowing into an asset.

Money flow is a crucial parameter: steady flows are often linked to positive price movements. If Bollinger Bands continue to narrow and the CMF continues to rise, it is a signal that bulls are entering Pi Coin. Growing investor interest could be related to speculation ahead of a broader altcoin rally.

The altcoin rally has already started for several cryptocurrencies in the past 24 hours. Pi Coin is now 15% above its all-time low of $0.40. The critical support level has held, and resistance has moved upwards. New resistance is now at $0.45. If the bullish guys manage to break through this level, the next target will be $0.51. With prolonged euphoria in the altcoin market, Pi Coin could aim even higher, up to $0.60.

However, profit-taking or stop-loss hunts could cause the price to fall below $0.40. A failed breakout could lead to lower lows, invalidating the current bullish scenario and putting Pi Coin at risk of testing the $0.35 all-time low.