Key Takeaways:
- Blur’s native token continues its downtrend after falling 85% since February 2023.
- No signs of a bullish reversal are visible amid negative market catalysts.
- What are these catalysts?
YEREVAN (CoinChapter.com) — Blur became the NFT market’s new darling after replacing its marketplace rival, OpenSea, in trading volumes after December 2022. However, its native token of the same name has failed to capture the bulls’ imagination.
Notably, the BLUR price is down 85% from its record high of $1.40 in February 2023. And it may decline further in the year based on a slew of negative catalysts. Here are three of them:
1. BLUR Deposits to Exchanges Soar
Investors have increased their BLUR token transfers to crypto exchanges since June 2023, intending to sell them for other assets.
According to data gathered by Arkham Intelligence, the cumulative US-dollar equivalent that has flown into exchanges amounts to nearly $91.5 million as of Aug 29. In comparison, the outflow was about $78 million two weeks ago.
The period of rising BLUR deposits into exchanges coincides with a 30% decline in the token’s spot price. Simply put, oversupplying BLURs against what appears to be a low-demand market has pressured its prices lower — and it may continue to happen in September.
2. Bear Flag Formation
The second reason behind a potential BLUR price decline seems purely technical.
Notably, the coin’s recent consolidation period has painted a bear flag, i.e., a bearish continuation pattern that forms when the price trends upward or sideways inside a parallel channel after undergoing a strong downward move.
A bear flag resolves when the price breaks out of the parallel channel to the downside while accompanying increasing volumes. Meanwhile, traders measure a bear flag target by adding the previous downtrend’s height to the breakdown point, as shown in BLUR’s coin daily performance chart below.
As a result, the price may drop toward $0.159 in September 2023, down approximately 20% from current price levels.
3. Rate Hike Fears Dampen BLUR Boost Expectations
Like any other crypto asset, BLUR’s market dynamics strongly rely on macroeconomic catalysts, primarily the Federal Reserve’s approach toward interest rates. On Aug 25, Fed Chairman Jerome Powell clarified that they may hike the rates to curb sticky inflation.
Higher rates have been historically bearish for cryptocurrencies. As a result, BLUR may keep declining until the next FOMC meeting on Sep 19-20, thus justifying the bear flag scenario mentioned above.
