Magic Eden (ME) which attracted attention with its airdrop on December 11$ME
, failed to meet expectations.
Magic Eden, one of the NFT marketplaces, attracted great attention with its recently launched ME token. However, the token’s trading volume has declined rapidly. This decline is attributed to the decrease in interest in the token after the airdrop.
The decline in the Magic Eden ecosystem is not limited to transaction volume alone. On-chain data also shows a decrease in other key metrics on the platform, providing clues as to what kind of price action the ME token may exhibit in the future.
According to Santiment data, Magic Eden’s trading volume was around $5.50 billion on the day of the airdrop on December 11. However, at the time of writing, that value has fallen to $1.58 billion, a loss of around $4 billion. Trading volume indicates how much an asset has been bought and sold in a given period of time, and higher volume is usually associated with higher prices. However, lower volume indicates a decrease in trading activity, making it difficult for the price to move upwards. This decline in trading volume for the ME token comes in parallel with the token losing 54% of its value since its launch.
If the decline in trading volume continues, it may be difficult for the ME token to recover from $5.15.
Along with the trading volume of the ME token, the NFT trading volume on Magic Eden has also decreased significantly. The NFT trading volume, which exceeded $3 million on Dec. 4, is currently only at $154,000, indicating that NFT trading on the platform has dropped significantly.
ME technical analysis
When examining the 1-hour chart, it is seen that the ME token is trading within a descending channel. The descending channel indicates a bearish market trend with lower highs and lows. This formation shows that sellers are dominant in the market and continue to push the price down.
If the decline in trading volume continues, the price may fall to $4.93. However, if the $5.13 level remains as support, this downward prediction may not come true. In such a scenario, the price may rise to $7.19.