The price of the Near Protocol token (NEAR) decreased by approximately 15% after reaching a local peak of $5.58. Currently, NEAR is trading at $4.78. Previously, the token showed a sharp increase of over 200%, rising from the range of $1.60 - $1.80 in August. The price decline may be just the beginning of a deeper cooling. Technical analysis shows that the last daily candle formed a classic bearish reversal pattern with a long red body that engulfed the previous green session. The price has already fallen below the psychological level of $5.00 after active seller intervention at the top, as evidenced by the peak reaching $5.58. The signal candle on September 23 also demonstrated a spike in sales volume, indicating that distribution began long before the recent decline.
Momentum indicators signal caution. Before the sharp drop, the Relative Strength Index (RSI) reached a deep overbought zone and briefly approached the level of 85. Typically, stretched values rarely stabilize, and cooling often manifests as a broader pullback. The difference between the price and its moving averages also confirms this information. The average line at $3.00, long-term moving averages in the range of $2.20 - $2.60, and the short-term average around $3.70 are significantly above NEAR.
A decline to the range of $3.80 - $3.70 would represent a 20% drop from the current level. Prices that are so far from their averages typically move back towards them, indicating a potential target zone. This coincides with the rising short-term moving average, which may serve as dynamic support, as well as the breakout zone at $3.80, where the rise accelerated. The level of $3.00 will become the next significant test below this. To negate the reversal signal and restore the path to the peak of $5.58, bulls need to return above $5.00 with significant volume. Risks in this situation are tilted downward until this occurs.
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