Monero crashes 65% from its January high: Technical indicators warn of additional risks

Since Monero reached its peak in January, the cryptocurrency has experienced a significant decline of 65%, positioning itself among the worst-performing assets in recent months. According to NS3.AI analysis, this sustained drop reflects persistent selling pressure that has defined price action since the trend reversal weeks ago. The available data paint a discouraging picture for bulls, with multiple layers of weakness emerging across different market segments.

The Bearish Structure Persisting Since the January Break

XMR maintains a bearish flag formation that has solidified since the winter highs were broken. This technical pattern is a continuation pattern that typically precedes more significant downward moves. Chart analysis reveals that each recovery attempt is being used by traders to establish short positions rather than accumulate, suggesting that sellers remain in control of the market. The exchange flow dynamics support this narrative, showing consistent net outflows during rebounds.

Critical Support Levels: $314 and the Risk Toward $150

Technical analysis identifies a key support level at $314, representing the last line of defense to prevent a more severe fall. If this barrier is decisively broken, traders project a potential move toward $150, implying an additional loss of approximately 50% from current levels. This projection reflects the inherent geometric risk of the current structure, where each new support break amplifies bearish prospects. Analysts warn that any breach of $314 should not be underestimated, as it would establish new lows for the period.

Derivatives Market: Confirmation of Institutional Weakness

In the futures markets, open interest has experienced a notable contraction, and funding rates remain weak. These derivatives indicators are particularly revealing, as they suggest that institutional and retail traders are not effectively leveraged long at current levels. The weakness in funding indicates that bullish speculation is limited, reducing the likelihood of rebounds driven by short liquidations. Overall, from a derivatives perspective, the XMR market is in a vulnerable position that could worsen if there is no fundamental change in sentiment.

Outlook: Trend Reversal or Continued Downtrend?

Monero faces a critical period where price action since January has established a pattern that could deepen further. With no clear institutional buying pressure and multiple aligned bearish technical signals, the probability of a continued decline exceeds that of a sustained rebound. Traders watching XMR should monitor behavior near $314, as this level will serve as the decisive breakout point for upcoming price movements.