PI Network (PI) is showing signs of weakening as mounting dilution risks and bearish technical indicators threaten to push the token lower. Despite a prolonged period of sideways movement, the current setup hints at a potential breakdown that could send prices into new lows.
Consolidation Breakdown Looming?
Since mid-April, PI has been locked in a tight sideways consolidation range, fluctuating between $0.59 and $0.67 — a narrow 14% trading band. As of April 29, PI is testing the lower boundary of this range near $0.58, signaling an increased risk of a downside break.
Technical indicators are reinforcing the bearish outlook:
- The Relative Strength Index (RSI) currently sits at 38, well below the neutral 50 level and approaching oversold territory.
- The MACD indicator shows a declining trend. Although the MACD line remains slightly above the signal line, the narrowing gap suggests an imminent bearish crossover could occur, marking a shift toward stronger downward momentum.
With momentum fading and key support levels under threat, traders are growing increasingly cautious about PI’s short-term price trajectory.
Mounting Token Unlock Pressure
Beyond technical factors, fundamental dilution risks are adding additional strain on PI’s price stability.
In April alone, approximately 21.4 million PI tokens worth around $12.3 million at current market prices were unlocked and added to the circulating supply.
While the recent unlock event appears modest, investors are bracing for more substantial unlocks ahead. Projections suggest that the average monthly unlock could surpass 131 million PI tokens over the next 12 months, significantly inflating the circulating supply.
Such consistent supply growth, without matching demand increases, is typically bearish for price action, creating persistent sell pressure across markets.
Future Risks: Supply Dilution and Lack of Deflationary Measures
The situation is further exacerbated by the fact that the PI Foundation holds nearly 72 billion PI tokens (specifically 71,991,181,249 π) across its wallets. Unless a significant portion of these holdings is burned or removed from circulation, fears of continuous dilution will likely persist.
Without a major ecosystem update, utility expansion, or a deflationary event like a token burn, PI could continue to struggle under the weight of its expanding supply.
PI Network is facing a critical juncture. While it has managed to hold within a narrow trading range for several weeks, weakening technical signals and the looming impact of heavy future token unlocks suggest that downward pressure may intensify. Investors should closely watch key support levels and monitor for any structural changes within the project that could alter the current bearish trajectory.
