The broader cryptocurrency market continues to grapple with persistent volatility, as Ethereum (ETH) extends its month-long decline of over 21%. This weakness has permeated major tokens, including Pump.fun (PUMP), which is now exhibiting a clear bearish breakdown on its charts.
PUMP has experienced a significant drop, decreasing by more than 11% today and extending its monthly decline to 24%. The latest technical developments suggest that the token may be preparing for further downside movement.
Head and Shoulders Breakdown
On the daily timeframe, PUMP had been forming a classic head and shoulders pattern, which is recognized as one of the most reliable bearish reversal structures in technical analysis. After failing to achieve higher prices from the right shoulder, which reached its peak around $0.005484 in early November, the token began to lose momentum.
Subsequently, PUMP declined towards the neckline support zone, situated near $0.0035. This level had served as a strong structural base for several weeks. However, the chart indicates that PUMP eventually broke below this critical support, confirming a bearish breakdown. This decline accelerated selling pressure, pushing the price down towards the $0.00235 region.
This technical development signifies a substantial shift in market structure, indicating that any remaining bullish momentum has dissipated and sellers now hold a stronger position in the market.
Outlook for PUMP
With the bearish breakdown now confirmed, traders are closely observing how PUMP will perform around the neckline, which has now transitioned into a resistance level. If the token attempts to retest this zone but fails to reclaim it, the bearish outlook is expected to strengthen further. This scenario would open the path towards the next key support levels, located near $0.002616 and $0.002265.
A continued move below these ranges could potentially drive PUMP towards new all-time lows, aligning with the breakdown target projected from the head and shoulders pattern.
Conversely, if buyers manage to reclaim the neckline zone, a temporary relief bounce might occur. Nevertheless, the broader market structure remains bearish, and investors are advised to exercise caution until the token successfully establishes higher lows and reclaims key resistance levels.