TRX price forms a double bottom as Justin Sun advises buying the dip

Tron’s price has recently experienced a strong downward trend, reaching its lowest level in over four weeks. The price dropped to $0.2200, representing a decline of more than 50% from its high in December. This price drop has caused TRX’s market capitalization to shrink from over $26 billion to $19 billion.

In response to the dip, Tron’s founder, Justin Sun, took to social media to encourage investors to “buy the dip,” maintaining his long-standing belief that Tron is undervalued. His bullish stance is supported by the strong fundamentals of the Tron network.

Tron remains a major player in decentralized finance (DeFi), ranking third behind Ethereum and Solana with a total value locked (TVL) of $6.69 billion. Tron is also the market leader in Tether (USDT) transactions due to its lower transaction costs compared to Ethereum. On Monday, Tron’s USDT transactions surged by 91%, reaching $137 billion, solidifying its position as one of the largest payment processors globally. The network currently hosts over 59.2 million USDT holders.

Tron also excels in the decentralized exchange (DEX) sector, handling nearly $100 billion in volume since its inception. In the past week, its DEX protocols processed over $782 million in transactions, ranking it as the 10th-largest chain by volume. Tron’s ecosystem remains popular, with over 2.17 million active addresses, positioning it as the second-largest blockchain in terms of active addresses after Solana.

In terms of staking, Tron offers competitive yields, with a current staking rate of 4.52%, supported by rising network fees and a shrinking circulating supply. Over the past year, Tron has earned $2.21 billion in fees, surpassing Ethereum’s $116 million in the same period. Additionally, Tron’s circulating supply has been steadily decreasing, moving from 88.1 billion in January last year to 86.17 billion today.

In terms of price analysis, Tron’s chart shows a decline from $0.4487 on December 4 to $0.2245 amid a broader market sell-off. The price has fallen below its 50-day and 100-day weighted moving averages, and key technical indicators like the MACD and Relative Strength Index (RSI) suggest bearish momentum. However, Tron has formed a double-bottom pattern at $0.2245, with a neckline at $0.2760. This pattern is often seen as a precursor to a potential bullish breakout.

If Tron can maintain its support at $0.2245, it suggests that the double-bottom pattern is intact, potentially leading to a recovery. However, if the price falls below this level, it could drop to $0.20, aligning with the ascending trendline that has been forming since June of the previous year.