Pi Network (PI) bounce back after a 4-day fall, technical signals suggest that investors should be cautious.

Pi Network (PI) increased by 2% on Tuesday, ending a four-day consecutive decline and marking a correction phase within a broader accumulation zone. The ongoing interest from large investors, also known as “whales”, is creating signs that this could be a potential accumulation zone, opening up the possibility for a bullish breakout in the near future.

However, although the cash flow from the “whales” remains strong, the technical picture of PI is still mixed. The momentum indicators currently show signals from neutral to bearish, making the short-term outlook for this coin not really clear yet.

The continuous interest of “whales” signals the possibility of recovery

The continuous interest from “whales” in a cryptocurrency during the Accumulation phase is often seen as a strong signal of a potential accumulation zone, opening up the possibility for an upcoming recovery. According to data from CryptoQuant, the buying activity of “whales” in the spot market is on the rise, leading to a significant increase in the average order size.

Market history also records a similar situation: an Accumulation PI phase in April paved the way for a strong recovery that took place in early May, suggesting the possibility of repeating this positive scenario.

Average order volume of Pi Network | Source: CryptoQuant## Technical outlook: Will Pi Network break out of the Accumulation zone?

As of the time of writing on Tuesday, Pi Network (PI) is trading below the (EMA) 50-day exponential moving average, continuing to show bearish pressure from the resistance zone around $0.2860 within the accumulation range. The important support level is currently recorded at $0.1919, coinciding with the bottom on October 11 and the peak on September 23.

A closing session above $0.2860 will confirm the bullish breakout potential from the accumulation zone, paving the way for PI to move towards the next resistance levels at $0.3220 and $0.3987, corresponding to the low on August 1 and the high on August 30.

Daily PI/USDT Chart | Source: TradingViewHowever, daily momentum indicators still warn of potential risks. The MACD line has crossed below the signal line on Monday, issuing a bearish signal and selling pressure. Meanwhile, the relative strength index (RSI) is bouncing back to 47, near the neutral line, reflecting a slight correction phase after four days of significant declines.

On the support side, market sentiment remains solid around the $0.2000 mark and the bottom at $0.1919, providing a strong foundation for any recovery efforts of the PI token.

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