Sentiment in the altcoin market continued to cool in May. Foreign media analysis indicates that the seasonal altcoin index has fallen to 31, and the overall market capitalization briefly attempted to reach $1 trillion but failed to stabilize. Following Bitcoin's pullback, market risk appetite for high-volatility tokens has also weakened.
Bitcoin pullback dampens sentiment
The report noted that Bitcoin has retreated nearly 9% from its early May high, and has fallen another 2.88% in the last 24 hours. Against this backdrop, Aerodrome Finance's token AERO has fallen 6.86% during the same period, underperforming Bitcoin and indicating weak buying support.
AERO rose from $0.31 to $0.55 between April and early May, a gain of approximately 77%. However, the article argues that this rise was more like a rebound during a downtrend than the start of a new upward trend.
The price of $0.45 has fallen below $0.45 again.
From a daily chart perspective, the area around $0.45 is a key level in the near term. This area acted as resistance in April, briefly turned into support in May, and was subsequently retested as resistance. Price pullbacks to this level were quickly met with resistance, indicating that selling pressure remains.
The article argues that this trend, coupled with Bitcoin's short-term weakness, suggests that AERO will face further downward pressure. If it cannot regain its footing in this area, the short-term trend is unlikely to improve.
Short-term resistance is located between $0.44 and $0.46.
Looking at the 4-hour chart, AERO's short-term structure has weakened after breaking below the higher low of $0.44 formed on May 7th. It subsequently rebounded to near the 50% retracement level, only to encounter resistance again at $0.467, indicating that the $0.44 to $0.46 range remains a significant resistance zone.
The observation range given in the text suggests that if the weakness continues, prices may continue to fall towards $0.384 and $0.345. Conversely, if prices rise above $0.55 again, the aforementioned bearish outlook will be significantly weakened.
