Magic Eden (ME) is the native token of the NFT marketplace Magic Eden, and its price has dropped 54% in the past 24 hours. This decline occurred on December 10, when ME completed a controversial airdrop of 125 million tokens.
Now, the trading price of ME has dropped to $4.99, and it may continue to fall.
Decline triggered by the airdrop
On Tuesday, Magic Eden conducted an airdrop of 125 million ME tokens, accounting for 12.5% of its total supply. After this airdrop, ME's price surged at one point, reaching up to $30 on certain exchanges.
However, due to the cumbersome claims process for the airdrop, coupled with technical issues, many users feel frustrated, leading to a wave of sell-offs, with ME's price plummeting 54% in 24 hours. Currently, ME's trading price is $4.99.
BeinCrypto analyzed the 1-hour chart of ME/USD, showing that market sentiment toward this token is becoming increasingly bearish. From the balance of power indicator, the current value is -0.70, below zero, indicating stronger bearish sentiment.
The BOP indicator measures the strength of buyers and sellers by analyzing price trends over a certain period. When the BOP is negative, it indicates that sellers dominate, market sentiment is bearish, and asset prices may face downward pressure.
Additionally, ME's Relative Strength Index (RSI) also supports this bearish expectation. As of now, the RSI is 47.21 and is still in a downward trend.
The RSI indicator is used to measure whether an asset is overbought or oversold, with a value range of 0 to 100. When the RSI exceeds 70, it indicates that the asset may be overbought and may need to adjust.
An RSI indicator below 30 typically indicates that an asset is oversold and may experience a rebound. Currently, ME's RSI is 47.21, showing that as bearish sentiment intensifies, selling pressure is also gradually increasing.
ME price prediction: Sell-offs may cause the token to drop to historical lows
As of now, ME's trading price is $4.99, slightly above the historical low of $4.13. If ME holders continue to sell, the price may return to this support level. If the bulls fail to hold this support level, ME's price may break below it and fall further.
However, if the demand for Magic Eden tokens rises again, the price may rebound and rise to $9.66.
