- NEAR’s price action continues sliding but demand could resume as it enters the oversold zone.
- Near Protocol’s strong organic growth could offer a safety net in the long term.
NEAR traders must be punching the air because of its bearish price action which has turned out to be a blessing for short traders. This was because the cryptocurrency continues to seek more downside.
Read Near Protocol’s [NEAR] price prediction 2023-24
Let’s take a look at just how far NEAR has fallen. Not only did it give up the gains achieved in January 2023, but NEAR also extended its downside to a new 2023 low. One unit of NEAR costed $1 at the time of writing. The last time that it traded at that price level was in December 2020.
Source: TradingView
NEAR’s extended downside may dampen investor sentiment but the glass-half-full perspective suggested something else. The cryptocurrency’s latest sell pressure pushed into oversold conditions which means the sentiment may be about to shift. In addition, we see some price- Relative Strength Index (RSI) divergence which may suggest that a pivot might be around the corner.
Understanding NEAR’s current state of demand
Despite the opportunity for a rally, on-chain metrics suggested that investors were still a bit shy about diving back in. This was evident by the Weighted Sentiment which was still close to its monthly low despite the heavily discounted price action.
Source: Santiment
Similarly, On-chain Volume showed a lack of excitement as the market struggled to secure a bullish footing. The good news was that the derivatives segment already showed signs of bullish demand resurgence. This was evident in the Binance and DYDX funding rates which reverted back to the positive side in the last two days.
Source: Santiment
Before you get too excited, it is worth noting that external factors such as the prospects of higher inflation have been rising. This underscores tight liquidity conditions which may lead to weak demand in the short-run.
Is your portfolio green? Check out the NEAR Profit Calculator
NEAR’s long-term prospects remain rock solid, especially considering its performance in the last three years. The price action might have been bearish but the Near Protocol has been enjoying significant growth.
NEAR managed to on-board over 1,000 projects onto its network during this three-year period. During that time the number of accounts grew to over 30 million.
Three years.
Thirty million+ accounts.
One thousand+ projects.No wonder the number one dApp in Web3 calls NEAR its home. pic.twitter.com/DB5SJW7dFr
— NEAR Protocol | NEARCON | November 7-10 | Lisbon! (@NEARProtocol) October 13, 2023
The key point here is that despite NEAR’s declining price action, the protocol has been building a strong ecosystem. It has a strong backing of organic growth which could support the transition of interest once the crypto winter is over. This could work out in NEAR’s favor in the long term.
