The price of NEAR Protocol (NEAR) has been facing headwinds recently, showing a significant 25% drop over the past month. Despite forming a bullish chart pattern, a series of technical and market indicators suggest that NEAR may be headed towards its 2024 low of $2.450 rather than experiencing a breakout. Let’s dive deeper into the current situation and what’s contributing to this downward pressure.

Bullish Chart Patterns in Conflict with Market Sentiment

On the daily timeframe, NEAR has formed a bullish triangle pattern. This technical setup consists of a diagonal resistance line and a horizontal support line, with both lines converging toward a breakout point. Typically, such patterns are viewed as indicators that a price surge could follow.

For the breakout to materialize, NEAR would need to hold the critical support level at $3.520. If the price bounces from this point, it could target two potential price points:

• A short-term target at $5.606
• A longer-term target at $8.520, depending on broader market conditions and investor sentiment.

However, this positive outlook may not be so straightforward. The altcoin faces significant risks from ongoing sell pressure that could prevent a bullish breakout. A failure to hold the $3.520 support could send the price lower, potentially revisiting the January 2024 low of $2.450. This would mark a significant decline for NEAR and could trigger further downward momentum.

Bearish Market Sentiment and Increased Sell Pressure

Despite the bullish technical pattern, the broader market sentiment for NEAR remains largely negative, with several key indicators suggesting that the altcoin could face additional losses in the near future. One of the most telling signs of this bearish pressure is the liquidation data, which highlights a sharp imbalance between long and short liquidations.

At the time of writing, long liquidations amounted to over $1.02 million, while short liquidations stood at just $45.81k. This disparity indicates that a large number of investors holding long positions are being forced to close their positions, amplifying the selling pressure. Such forced liquidations are often a precursor to more downside as more traders attempt to sell in reaction to these market movements.

Another bearish indicator is the decline in Open Interest, a measure of outstanding derivative contracts. Open Interest for NEAR has dropped by 1.65% over the past 24 hours, now sitting at $185.65 million. A decrease in Open Interest suggests that market participants are becoming more hesitant, with fewer new positions being opened. This shift reinforces the negative sentiment surrounding the altcoin.

Key Technical Indicators Point to Downside Risk

In addition to the liquidation and Open Interest data, several technical indicators confirm that NEAR is currently in a bearish trend, further weighing on its potential for recovery.

• Relative Strength Index (RSI): The RSI, a popular momentum oscillator, is currently at 30.69, approaching oversold territory. If the RSI falls below the critical 30 mark, it would confirm that NEAR is in an oversold condition, increasing the likelihood of continued downside.
• Parabolic SAR (Stop and Reverse): The Parabolic SAR indicator, which tracks trends by placing dots above or below the price candles, is signaling bearish momentum. With the dots above the price candles, this traditional setup points to a downtrend, reinforcing the negative outlook.

Given the combination of these technical indicators, the bullish triangle pattern seems increasingly unlikely to lead to an immediate breakout. The RSI and Parabolic SAR both suggest that NEAR is struggling to maintain upward momentum and is at risk of further declines.

NEAR’s 2024 Low Could Be Within Reach

Despite the bullish triangle pattern on the daily chart, it is clear that bearish forces are currently in control of the market. The liquidation data, declining Open Interest, and technical signals from the RSI and Parabolic SAR all point to a continued downtrend for NEAR. These indicators suggest that the asset may be heading toward its 2024 low of $2.450.

For investors holding NEAR, the situation is precarious. If the $3.520 support level fails to hold, further declines toward lower targets are likely. A sustained drop could see NEAR testing its 2024 low, and if bearish conditions persist, the altcoin might face a prolonged downtrend before any significant recovery takes place.

What Investors Should Watch For

With NEAR at a pivotal point, traders should be cautious and monitor the asset closely. If the price can maintain support around the $3.520 level, there may still be hope for a bullish reversal. However, if this support level breaks, it could set the stage for further losses, potentially down to the 2024 low of $2.450.

Investors looking to enter the market should consider waiting for more clarity, especially given the current bearish signals. NEAR may need to stabilize and show a sustained recovery before it can confidently reclaim higher price levels. For now, the market remains in a cautious and reactive state, making it difficult to predict a rapid recovery in the near term.

Conclusion: Cautious Optimism Amid Bearish Pressure

In conclusion, while NEAR has formed a bullish triangle pattern, the broader market conditions and several bearish indicators suggest that the altcoin may face further declines before any significant recovery. The combination of liquidation data, declining Open Interest, and weak technical indicators points to a high likelihood that NEAR will test its 2024 low. As always, investors should exercise caution and monitor the $3.520 support level closely to assess whether the altcoin can regain its bullish momentum or continue its downward trend.