Jupiter (JUP) Struggles to Recover After Failing to Reverse 20% Price Drop

Key Takeaways

• JUP’s Open Interest has dropped from $250 million to sub-$100 million levels.
• This decline is bearish amid the token’s failure to rise above key resistance.
• The major resistance lies at $1, and the correction could extend with low demand.

In the last 30 days, Jupiter’s (JUP) price has dropped by 20%. This performance contradicts the signs the cryptocurrency showed after the airdrop in January.

During that period, JUP’s price rallied to $1.40 and showed readiness to break $2. However, the token consistently failed rejection at almost every point.

Amid this repeated failure, the altcoin’s technical setup seems in disarray. With this in place, JUP’s price could struggle to reclaim $1 in the short term.

Exposure to JUP PlungesFfrom January Highs

When JUP’s price climbed above $1 about a month ago, the Open Interest (OI) soared to $250 million. OI is the value of the sum of all open contracts in the market.

An increase in the OI indicates rising exposure to a cryptocurrency. When this occurs alongside a price increase, it strengthens the northward move.

On the other hand, a decreasing OI signifies that traders are closing their positions and removing liquidity from the market. In most cases, this drop is a bearish sign that leads to a price decrease.

According to Santiment, Jupiter’s OI has fallen below the $100 million mark. Considering the conditions above, this drop indicates a decrease in net positioning.

If sustained, JUP’s price will likely experience an extended decline in the short term.

The Altcoins Remains Trapped

Furthermore, the technical perspective also seems to agree with this position. On the 4-hour chart, JUP’s price keeps trading within a descending triangle.

A descending triangle is a bearish pattern with a falling upper trendline and a flat lower support line. As of this writing, the JUP price is above horizontal support and has recently tested the upper trendline.

While it failed to break above this hurdle, JUP’s price risks falling below the lower support line because of the Relative Strength Index (RSI) position.

As of this writing, the RSI has dropped below the neutral region, indicating that the momentum around JUP has remained bearish. If sustained, the JUP’s price might experience another correction.

JUP Price to Lower Lows

The daily timeframe does not really appear different. On this chart, JUP’s buy signal was invalidated as soon as the price dropped below $0.76.

As a result, the red segment of the Supertrend indicator is now above JUP’s value and positioned at the $1 mark. This indicates that the major resistance for JUP now stands at $1.

In addition, the Awesome Oscillator (AO) reading is negative, aligning with the bearish thesis shown by the RSI above. JUP’s price might slide to $0.66 if this technical setup fails to change.

On the other hand, if the momentum around the token turns bullish, this trend might change.

The cryptocurrency’s value could break the $1 resistance and target a new high in that scenario.