Justin Sun’s Tron coin has remained in a deep bear market despite having some of the strongest fundamentals in the crypto industry. Tron price has dropped to $0.2320, down by over 57% from its highest level in December last year. This article explores why the TRX price may bounce back in the coming weeks.
Tron price prediction: falling wedge pattern forms
The daily chart shows that the TRX price peaked at $0.4485 in December and has now crashed to $0.2320. It has slipped below the 50-day Exponential Moving Average (EMA), a highly bearish sign in the market.
The Relative Strength Index (RSI) has moved from 94 in December to the current 44, while the MACD indicator has remained below the zero line.
On the positive side, the coin has formed a falling wedge pattern comprising two falling converging trendlines. Historically, this is one of the best-performing signs in the financial market. When the two lines are about to converge, a bullish breakout often forms.
Therefore, a bullish breakout will likely lead to more Tron price surge, potentially to last year’s high of $0.4485, up by about 95% above the current level. A drop below the support at $0.200 will invalidate the bullish view.
TRX price chart by TradingView
Catalysts for the upcoming TRX price rally
The Tron price rally faces numerous catalysts that could push it much higher in the coming months, including:
Part of World Liberty Finance portfolio.
Stablecoin transactions are rising.
Falling supply.
Meme coin potential.
The first main reason why the Tron price may jump soon is that it is part of the World Liberty Financial, the crypto project by Donald Trump. It acquired 40.7 million TRX tokens currently worth over $9.47 million.
WLFI made the investment in Tron after Justin Sun made a big investment in it that helped it achieve a $1 billion fundraising target.
These transactions are big deals because Donald Trump controls the judiciary, meaning that he may arrange for the lawsuit against Sun be removed. Sun has been accused by the Securities and Exchange Commission (SEC) for market manipulation.
The other big catalyst for the Tron price is that it has become the biggest player in the stablecoin industry because of its low transaction costs. It has become so popular such that it is now handling over $100 billion in transactions each day.
Tron’s transaction volume has helped it to become a highly profitable network, making over $320 million in fees this year. This makes it the second-biggest chain after Tether, which has made over $456 million the year so far.
Tron returns some of these funds to its holders through staking. Its reward rate stands at about 4.50%. This rate will continue rising since Tron is a highly deflationary network because of its token burns. Data shows that the number of Tron tokens in circulation has continued falling in the past few years. There are now 86.1 billion TRX in circulation, down from over 100 million a few years ago.
Further, Tron has a chance to grow its meme coin ecosystem when the ongoing altcoin crash ends. Data by CoinGecko shows that the total market cap of all Tron meme cins has dropped to $147 million. The biggest ones in the ecosystem are Shisha Coin, Sundog, Puss, Tron Bull, and Sugar Boy. This ecosystem will likely continue growing, leading to more fees in the network.
Tron has over 2.2 million active addresses and $5.7 billion in total value locked (TVL), making it one of the biggest players in the crypto industry.
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