STEPN rebounds sharply after falling 80% in a month — is GMT price bottoming out?

A large downtrend within the STEPN (GMT) costs witnessed within the final 30 days seems to be nearing exhaustion.

GMT’s price has rebounded by almost 35%—from $0.80 on Could 27 to $0.99 on Could 28. Curiously, the upside retracement began after the value fell in the identical vary, which had acted as assist earlier than GMT’s 500% and 120% value rallies in March and early Could, respectively.

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GMT/USD day by day value chart. Supply: TradingView

Moreover, the rebound additional preceded an 80% drop from its report excessive of $4.50, established on April 27, which left GMT oversold, per its day by day relative energy index studying that slipped beneath the oversold threshold of 30 on Could 26.

The technical assist, along with oversold RSI, suggests GMT is within the strategy of bottoming out.

GMT value ranges to look at

Drawing a Fibonacci retracement graph from GMT’s $0.0099-swing low to $3.82-swing excessive leaves the token inside a broader consolidation vary, outlined by the 0.382 Fib line (close to $1.50) appearing as interim resistance and the 0.786 Fib line (close to $0.82) serving as interim assist.

GMT/USD day by day value chart that includes Fib assist/resistance ranges. Supply: TradingView

Subsequently, an prolonged rebound transfer from the $0.82-support degree brings $1.50 into the eye as the following upside goal, up about 40% from as we speak’s value. Furthermore, a robust upside follow-up might ship the STEPN token in the direction of the $2-2.50 space, suggesting that the market has bottomed out.

Conversely, a weaker upside follow-up might have GMT’s value retest $0.82 for a breakdown transfer towards $0.54. This degree was instrumental in capping the token’s draw back makes an attempt between March 17 and March 21 earlier this 12 months.

STEPN a “hype-driven speculative frenzy?”

From the basic perspective, GMT’s bias seems skewed to the draw back.

First, the token continues to commerce in near-perfect tandem with Bitcoin (BTC) and the opposite top-cap cryptocurrencies, in line with their day by day correlation coefficient readings, which topped 0.98 on Could 21, however had subsided to 0.75 on Could 28.

GMT/USD and BTC/USD day by day correlation coefficient. Supply: TradingView

So, if Bitcoin continues to struggle below $30,000, as many analysts consider, it might take GMT decrease alongside on account of its constant constructive correlation with the token.

Second, GMT might drop because of the rising uncertainties surrounding STEPN’s business model, which includes paying customers for exercising both by strolling, jogging, or working with the native Inexperienced Satoshi Token (GST) items.

Mike Fay, an unbiased market analyst and the writer of the Heretic Speculator monetary publication, says that STEPN’s so-called move-to-earn mannequin is neither scalable nor sustainable in the long run.

The analyst cited some core points with the “way of life app.”

First, STEPN has an enormous entry barrier for it makes individuals purchase its costly “Sneaker NFTs.” However even then, individuals purchase these digital points for lots of or 1000’s of {dollars} in anticipation that they’d recuperate their investments by incomes and selling GST tokens.

Many customers have already recouped their cash, similar to YouTuber Sebbyverse, who claims that he earned $219 value of GST tokens simply by strolling quarter-hour to-and-fro for dinner. 

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“The way in which this seemingly ends is with the final individuals who come into the platform basically serving as ‘exit liquidity’ for the early adopters when the app’s in-game cost token (GST-USD) collapses,” Fay stated whereas highlighting that the STEPN’s in-house token is already crashing. 

GST/USD day by day value chart. Supply: TradingView

That will harm customers’ return on funding who paid 1000’s of {dollars} for Sneaker NFTs. So, if the demand for NFTs dries up and incentive drops, STEPN would have bother attracting new gamers to its app, thus dampening demand for GMT, in line with Fay. He added:

“STEPN is in a hype-driven speculative frenzy and I am not touching any of this. Not the payout token (GST-USD), the governance token GMT, or the NFTs.”

The views and opinions expressed listed here are solely these of the writer and don’t essentially mirror the views of Each funding and buying and selling transfer includes danger, you must conduct your individual analysis when making a call.