FET suffered a 5% decline last week and now faces further downward pressure as dormant token holders reactivate and move their coins.

With bearish sentiment prevailing and insufficient demand to absorb the increased supply, the FET price is likely to continue its downward trend.

Old FET tokens back in circulation

During the intraday trading session on Wednesday (10), FET recorded a significant increase in its consumed age. The metric, which tracks the movement of long-standing coins, increased by more than 600% in a single day. Thus, reaching 1.33 billion — its highest value since September 13.

When an asset’s age consumption spikes, it indicates that many previously dormant tokens have recently been moved or traded. These spikes are often significant because long-term holders rarely move their assets.

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So when they do happen, they are often a precursor to a change in market dynamics. Typically, when dormant coins return to circulation, it indicates renewed activity from long-term holders.

However, the market must show strong demand for this to translate into positive growth for the price. In the case of FET, this is lacking as market sentiment towards the altcoin remains bearish.

FET consumed age. Source: Santiment

Currently, the FET price is below the 20-day exponential moving average (EMA) and the 50-day small moving average (SMA), confirming weakening demand. The 20-day EMA measures its average closing price over the past 20 trading days, while the 50-day SMA is a long-term indicator that tracks the asset’s average closing price over the past 50 days.

FET 20-day EMA/50-day SMA. Source: TradingView

When an asset's price trades below these key moving averages, selling pressure outweighs buying activity. Traders interpret this setup as a signal for further downward movement.

Price forecast

FET’s moving average convergence/divergence (MACD) indicator readings show that its MACD line (blue) is below its signal line (orange) and is about to break through its zero line. When this indicator, which tracks an asset’s trend direction and potential price reversal points, is configured this way, buying pressure is weakening, and a sustained price decline is likely.

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If FET continues to witness a decrease in demand, its price could drop to a two-month low of $0.70.

However, if the market sentiment changes from bearish to bullish, the FET price may start an uptrend and rise to $2.09.

FET Price Analysis. Source: TradingView

The article Bearish Momentum Makes Holders Abandon FET – What’s Next? appeared first on BeInCrypto.