Pyth Network (PYTH) has experienced a significant drop in price, declining by over 66% from its yearly high. The technical indicators are pointing towards a further downside for the token.
As of May 21, Pyth was trading at around $0.124, marking a 3% decrease in the past 24 hours and reaching its lowest point since April 11. The token’s market cap is currently just above $22.7 billion.
The recent price slide can be attributed to a scheduled token unlock on May 20, which released approximately 2.13 billion PYTH tokens into circulation, valued at $275.11 million. This unlock, part of Pyth’s annual vesting cycle, distributed tokens to early investors, contributors, and ecosystem participants.
Following the token unlock event, Pyth’s circulating supply increased to nearly 5.75 billion tokens, representing around 57.5% of its maximum supply capped at 10 billion tokens. Approximately 36% of the total supply is now in active circulation, with the final two unlocks scheduled for May 2026 and May 2027.
Large token unlocks like this often unsettle investors as they introduce a significant volume of new tokens into the market without a corresponding increase in demand, leading to downward price pressure. However, such events are typically part of a project’s long-term roadmap to distribute ownership more broadly and reward early contributors.
While the impact of the token unlock may have already been factored in due to prior disclosure, there is still a risk of a further price decline in the coming weeks. Technical analysis indicates a potential death cross pattern forming on the 4-hour/USDT chart, where the 200-day and 50-day Exponential Moving Averages are on the verge of crossing downwards.
In the event of a confirmed death cross, PYTH’s price could continue to decline, with $0.10 serving as a key support level to monitor. The Relative Strength Index (RSI) currently sits near oversold territory at 30, suggesting a possible short-term relief rally as buyers seek to capitalize on the dip. However, any recovery may be temporary unless there is a shift in the broader trend.
It is important to note that this article does not constitute investment advice and is intended for educational purposes only. Investors should conduct their own research and analysis before making any financial decisions.