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The Tron price has continued on its recovery path since reaching a bottom in mid-March, steadily climbing almost every week. Mirroring the improving crypto market sentiment, the price of TRX maintained a level of stability in its bullish momentum throughout the month of May as it slowly ascended to a local high above $0.28.
However, the slow-and-steady growth of the cryptocurrency was met with a significant obstacle over the past week, reflecting what seems to be a return of bearish sentiment in the altcoin market. Here’s a look at the possible reason why the Tron price might be struggling at the moment. Tron Sellers Gain Traction: Spot CVD Data
In a Quicktake post on the CryptoQuant platform, on-chain analyst Burak Kesmeci published data from his analysis, pegging Tron’s dip in value to as high as 5.48% in 48 hours. Kesmeci’s analysis revolved around the Spot Taker CVD (Cumulative Volume Delta, 90-Day) metric, which tracks by volume the net difference between market buys (Taker Buy) and market sells (Taker Sell) over a period of 90 days. Related Reading XRP Set For Price Relief, But Only If Bulls Defend Key $2.13 Price Level – Details 1 day ago
According to the crypto pundit, a positive and rising value of the CVD metric indicates a higher Taker Buy volume and the dominance of buyers in the market. On the flip side, a negative or dropping value of the on-chain indicator reflects a higher Taker Sell volume and suggests that sellers are overwhelming the market.
Data from Kesmeci’s publication shows how the market devolved from being dominated by the buyers to being bearish. The chart below shows a transition from green bars (Taker Buy Dominant) to red bars (Taker Sell Dominant). Source: CryptoQuant
The shift from buys to sells became evident from around May 22nd and has since intensified, leading to a steady decline in the price of Tron. However, the Cumulative Volume Delta (marked in gray) has shown neutral on-chain action over the last few days. Caution In The Market Warranted
Kesmeci, in his conclusion, stated that if this negative CVD trend were to continue, it could signal further correction in Tron’s price. The relatively neutral state of current on-chain activity, though, suggests that investors’ uncertainty about the future trajectory of the cryptocurrency. Related Reading Can Dogecoin Price Still Rally 1,000%? Analyst Reveals End-Of-Year Prediction 1 day ago
However, investors should still pay rapt attention as a further increase in sell pressure could heighten volatility and, consequently, lead to liquidations. As of press time, Tron trades at $0.2656, reflecting a price rise of approximately 1% in 24 hours. According to CoinGecko data, the TRX token is down by more than 1% in the past seven days. The price of TRX on the daily timeframe | Source: TRXUSDT chart on TradingView Featured image from Gemini Imagen, chart from TradingView