- PUMP has dropped to a five-month low amid heavy holder selling.
- On-chain data shows record capital outflows and rising bearish conviction.
- Bitcoin correlation increases downside risk if broader markets weaken further.
Pump.fun has entered a sharp downturn, with PUMP falling to its lowest price in five months as selling pressure continues to build. The decline reflects sustained capital outflows from holders who appear increasingly unconvinced about the token’s near-term upside. Broader market weakness has only amplified the move, with Bitcoin’s instability weighing heavily on already fragile sentiment across smaller-cap assets.
On-Chain Signals Point to Capitulation
On-chain indicators paint a clear picture of deteriorating confidence. The Chaikin Money Flow has dropped deep below the zero line, signaling aggressive capital withdrawals rather than accumulation. Notably, the CMF has now reached an all-time low, marking the largest outflow event in PUMP’s trading history. Readings this extreme typically reflect strong bearish conviction, not indecision.
Persistent selling has also reduced liquidity support, making it harder for price to stabilize. Without fresh inflows stepping in, downside risks remain elevated, and any bounce is likely to face immediate resistance.
Bitcoin Correlation Adds More Pressure
PUMP’s broader outlook remains tightly linked to Bitcoin’s performance. Its correlation with BTC has rebounded to roughly 0.78, indicating that the token is once again closely tracking Bitcoin’s price movements. That relationship is problematic as Bitcoin struggles to find stability near the $86,000 level.
When market leaders wobble, smaller tokens often absorb amplified losses. If Bitcoin weakens further, PUMP is likely to follow, extending the drawdown for remaining holders and reinforcing the risk-off dynamic.
Price Action Signals More Downside Risk
At the time of writing, PUMP is trading near $0.002031, down more than 33.8% over the past week alone. The speed of the decline reflects worsening sentiment and a lack of consistent buying interest. If selling continues, price could test the $0.001917 support level, a key zone for short-term stability.
A clean break below that area would expose lower support near $0.001711, further strengthening the bearish trend and increasing volatility. For now, momentum remains firmly tilted to the downside.
What Would Change the Outlook
A recovery scenario hinges on broader market improvement and renewed capital inflows. Reclaiming $0.002123 as support would be an early sign that selling pressure is easing. If buyers regain confidence, PUMP could attempt a move toward $0.002428, which would invalidate the current bearish structure and restore some short-term optimism.
Until then, the path of least resistance remains lower.
