Pi Network Underperforms Against the Market
The Pi Network (PI) is currently trading at $0.3840, having experienced a 0.2% decrease over the past day. The token has been weaker recently, falling from its early-week values of over $0.40. Over the past week, PI has seen a significant 14.20% decrease, underperforming against the broader market and other Layer 1 tokens. This price slump has also been accompanied by a drop in market participation, with the daily trading volume decreasing by 46% to $35.19 million.
This lower volume suggests a period of consolidation and reduced investor interest, which often precedes a major price move in either direction. Despite this downturn, the project’s market cap remains at a notable $3.01 billion, showing that it still commands a significant presence in the crypto space.
The Bullish Engulfing Candle on the Weekly Chart
Despite the recent price drop, a closer look at the weekly chart reveals a potential bullish signal: the formation of a bullish engulfing candle. This pattern, which occurs when a large bullish candle completely “engulfs” the previous bearish candle, often indicates a potential shift in momentum from sellers to buyers.
This technical signal, as highlighted by a crypto analyst on social media, suggests that a rebound could be on the horizon. The token is now facing a crucial test of its support level at $0.38, while resistance is in place in the $0.40-$0.41 range. A successful defence of the $0.38 support and a breakout above the resistance could confirm the bullish thesis and lead to a significant upward move.
Short-Term Forecasts and Price Predictions
Short-term forecasts for the Pi Network are a mixed bag of caution and optimism. While a breach of the $0.38 support could lead to a steeper decline towards the $0.30 mark, a successful rebound could trigger a major rally. Analysts predict that a break above the $0.40 resistance could lead to a 25-30% upsurge, potentially driving PI to the region of $0.50-$0.60 later in August.
However, other models are more cautious, anticipating that PI will remain in a tighter range of $0.38-$0.39 until September. The EMA and MACD indicators are also signalling caution, suggesting that a sustained recovery would require a decisive price move above the $0.40 level. The market is now at a pivotal point, and the coming sessions will be crucial for determining the token’s short-term direction.
Tokenomics and Ecosystem Developments
The Pi Network has recently opened up 3.5% of its supply in the chain, a move that has introduced new liquidity into the ecosystem. While this liquidity could influence short-term pricing, the project’s long-term success will depend on its ability to build a vibrant and functional ecosystem. The project’s mining process and its targets in developing a developer platform are mobile-friendly and have practical application in the real world, which makes them accessible across the globe.
However, experts are also warning of a potential bearish trend in September, which could mount new pressure on the token’s price. The project’s ability to navigate these challenges and to build a strong, decentralised ecosystem will be a major factor in its long-term viability.
The Broader Context of Layer 1 Tokens
Pi Network’s recent price action is also a reflection of a broader trend in the crypto market. While PI has been weaker, other Layer 1 tokens have seen a gain of 1.50% in the past week. This suggests that the market is still bullish on the Layer 1 sector as a whole, but it is being more selective about which projects it is investing in. The performance of PI, therefore, is a test of its ability to compete with other Layer 1 tokens that have a more established track record and a clearer path to utility.
The project’s market cap and daily volume, which have seen a significant dip, are a sign that it has a long way to go to catch up with its competitors. The coming months will be a crucial test of its ability to gain back market share and to prove its long-term viability.
PI’s Next Move Hinges on Key Levels
In a volatile market, the importance of support and resistance levels cannot be overstated. For PI, the support level at $0.38 is a crucial threshold. A successful defence of this level would signal a strong base of buyers and could trigger a new rally. Conversely, a breach of this level could signal a lack of confidence and lead to a steeper decline.
The resistance at the $0.40-$0.41 range is also a key level to watch. A break above this resistance would confirm a bullish trend and could open the door for a move to the $0.50-$0.60 range. The market is now at a pivotal moment, and traders and investors will be watching closely to see how PI reacts to these levels.
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