PUMP Faces Long Liquidations of $8.3 Million After Price Drop

The figure of $8.3 million in long position liquidations resulted from a significant price drop of the PUMP token on the Pump.fun platform, which failed to hold at $0.0061 and fell to $0.0054. High volatility in the market arose after a weak employment report, prompting investors to reduce their positions. The trading volume of the PUMP token increased by 55%, reaching $605 million, indicating a rise in selling activity.

According to Lookonchain, two major traders fell victim to the liquidation, opening long positions on 707.6 million PUMP worth $3.61 million. Overall, long position liquidations for PUMP exceeded $8.3 million, with short position liquidations at $0.7 million. This led to panic among traders who rushed to close their positions, resulting in a $385 million outflow in futures compared to a $374 million inflow, yielding a net outflow of -$10.7 million. Despite the pressure from the derivatives market and falling prices, demand in the spot market remains stable. According to Coinalyze, the buying volume in the spot market surpassed the selling volume for three consecutive days. On October 2, the buying volume was 25.5 billion, while the selling volume was 24.6 billion.

Structurally, the market still tends to have a bullish sentiment. PUMP continues to show higher lows, holding around an upward support. At the time of writing, the MACD indicator was moving upwards, and the relative strength index (RSI) was in the bullish trend zone at around 62. If buying pressure in the spot market continues, it could help PUMP regain its position at $0.006. Otherwise, if sellers in the derivatives market maintain the current pace, PUMP will be under pressure and may fall to $0.0046.