Pi Coin's Meme Coin Shift: Price Surge Incoming?
Pi Coin Mimics Meme Coin Behavior: What's Next?
Pi Coin has shown resilience, up 5.5% over the past week, surpassing the performance of XRP, BCH, Ton, and Uniswap. However, recent market downturns have spurred investor concerns and new perspectives.
The coin's price action is increasingly resembling that of leading meme coins, which could significantly impact its short-term outlook.
Strong Correlation with Meme Coin Majors
Recent data indicates a strong correlation between Pi Coin and major meme coins. Specifically, Pi shows a correlation of:
- 0.76 with Dogecoin
- 0.84 with Shiba Inu
- 0.89 with Bonk
- 0.86 with Floki
These figures suggest that Pi Coin's volatility now mirrors that of the meme coin sector. Consequently, Pi Coin may experience similar rallies and corrections.
Should meme coins rally, Pi Coin could follow suit. Conversely, a cooling-off period in the meme coin sector could drag Pi Coin down, making meme coin sentiment a crucial short-term driver for Pi's price direction.
Technical Risks Emerge on 4-Hour Chart
Pi Coin's increased correlation with meme coins also means increased susceptibility to broader sector movements. Given the recent pressure in the meme coin market, continued weakness could pull Pi Coin lower.
The 4-hour chart reveals a potential death crossover, where the 20-period EMA (Exponential Moving Average) approaches a cross below the 50-period EMA. If this pattern confirms amid negative meme coin sentiment, selling pressure could intensify.
Bullish Divergence Setup in Pi Coin Price Action
Despite these risks, the link between Pi Coin and meme coins also means a recovery in the meme coin space could positively influence Pi's price action.
The daily chart indicates a bullish RSI divergence, where the price has made a lower high, while the RSI has printed a higher high. With the RSI holding near 43.71, a push above 47 would confirm a fresh higher high, bolstering the bullish outlook.
If meme coins rebound, Pi Coin could potentially reclaim $0.39 and retest the $0.41–$0.43 range. However, until confirmation, the 4-hour death cross remains a risk.
A breakdown below $0.37 would invalidate the divergence, increasing Pi Coin's vulnerability, particularly if the meme coin sector continues its downtrend. The sector's trend will likely determine whether Pi Coin breaks out or fades with the broader market.