Onyxcoin Faces Significant Sell-Off: 57% Drop from January Highs

Since peaking at $0.049 on January 26, Onyxcoin (XCN) has been in a steady decline, currently trading at $0.015. This represents a 57% depreciation from its all-time high.

With increasing bearish sentiment in the market, further declines may be imminent as indicators suggest continued downward pressure.

Heavy Selling Pressure on XCN

The recent outflows from XCN’s spot markets illustrate a surge in selling activity among investors. According to data from Coinglass, the altcoin experienced only four days of positive inflows throughout February, amounting to just $3.5 million. In stark contrast, spot outflows soared beyond $15 million during the same timeframe.

This month alone, XCN has witnessed outflows reaching about $6.45 million. Significant outflows indicate that many investors are offloading their assets, suggesting a lack of new demand for XCN, which could exert downward pressure on the coin’s price in the near term.

Further complicating the situation, the funding rate for XCN has mostly remained negative since the beginning of the year, highlighting a prevailing bearish sentiment among traders.

This funding rate reflects an ongoing exchange of fees between long and short position traders in perpetual futures contracts. A persistently negative funding rate suggests that short positions are prevalent, implying that market participants anticipate further price declines, thereby reinforcing bearish sentiment.

XCN in a Prolonged Downtrend: Reversal on the Horizon?

Analyzing the daily chart reveals that XCN continues to trade within a descending parallel channel established since its peak on January 26. This persistent bearish formation hints at a prolonged downtrend as the price oscillates between two downward sloping trendlines.

The consistent pattern indicates that sellers are firmly in control. Should the price breach the lower trendline, seen as a support level, XCN could further decline to around $0.0075.

However, if a bullish reversal occurs due to an influx of new demand, it could help XCN’s price rally back to $0.022.