After delivering an impressive rally earlier this month, the Pyth Network’s native token, PYTH, has taken a sharp turn downward, losing nearly all of the gains it made in a matter of days. The token, which had been gaining significant attention in the altcoin space, saw a staggering 64% jump between May 6 and May 9, climbing from around $0.128 to a high of $0.211. However, this rally was short-lived, and the price has since dropped back to its original breakout zone, signaling a potential shift in momentum that now heavily favors the bears.

While a brief upward bounce was observed over the past 24 hours, with PYTH rising around 5.6%, that move came with a catch. The trading volume dropped 15% compared to the previous day, a warning sign that buying interest may already be fading. Traders appear to be taking a neutral stance for now, unwilling to fully commit to either side until a clearer trend emerges. This indecision is echoed by technical indicators, which suggest that a full recovery may be difficult without renewed demand.

The recent pullback followed a typical “blow-off top” scenario, where prices surge rapidly only to collapse just as quickly. This pattern is often seen when short-term euphoria in the market gives way to profit-taking and caution. The volume spike at the peak of PYTH’s rally pointed to a temporary exhaustion of buyers, and since then, the selling pressure has only intensified. The on-balance volume (OBV), which tracks buying and selling pressure, spiked during the rally but has since fallen to new lows. This decline in OBV confirms that selling volume has outpaced buying activity, which is a bearish sign for the near term.

Another technical indicator adding to the gloomy outlook is the MACD, or Moving Average Convergence Divergence. At press time, the MACD showed a bearish crossover and continued to dive below the zero line, a clear indication that downward momentum is gaining strength. Although there are early signs of the OBV trying to stabilize, the broader trend remains negative. Price action has broken below the key support level of $0.135, further cementing the bearish market structure. This drop underlines the vulnerability of PYTH’s current price zone, and any minor recovery could simply be a short-lived bounce rather than a true reversal.

Market analysts also point to data from liquidation heatmaps as a reason for caution. According to a recent two-week heatmap, the $0.137 to $0.15 price range has become a focal zone where a significant number of liquidations could occur. This means that price movements in this range could be highly volatile, driven more by stop-loss triggers than genuine buying interest. While a 10% bounce within the week is not off the table, such a move would likely face stiff resistance and may not shift the overall trend.

For PYTH to truly recover and signal that bulls are back in control, the price would need to break convincingly above the $0.16 level. Until that happens, any upward movements may be seen as part of a broader downtrend or consolidation phase. Traders looking to go long should exercise caution and wait for confirmation before making any aggressive entries. As of now, the prevailing sentiment remains cautious to bearish, with most signs pointing to further downside risk unless market conditions change dramatically.

In summary, while PYTH recently enjoyed a dramatic price surge, that momentum has quickly reversed, and all eyes are now on whether bulls can defend key levels. With technical indicators flashing red and trading volume on the decline, the path of least resistance appears to be downward. Unless the token manages to break past critical resistance soon, bears are likely to maintain control — and the next move could catch optimistic traders off guard.