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PUMP Price Prediction: Why Pump.Fun Could Hit $0.01 Soon

Highlights:

  • PUMP has been in a strong bullish channel since late August 
  • Continuation of this rally could see PUMP hit $0.01 soon
  • Token buyback and upcoming US rate cut could send PUMP to $0.01

Pump.Fun (PUMP) has recorded impressive gains in the last 24 hours, continuing the strong momentum it has built up in the weeks. At the time of going to press, PUMP was trading at $0.0081, up by 8.1% in the day. Despite the surging price in the past week, PUMP’s 24-hour volumes have decreased.

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PUMP trading volumes were down by 1.46% when writing to $1.19 billion. This could mean holders are not selling, expecting PUMP to go even higher in the short to medium term. It could also mean that new investors are sitting on the sidelines waiting for confirmation on whether the bull rally for PUMP is fully confirmed. Both scenarios are bullish for PUMP. 

That’s because if holders are not selling despite the surge in price, it means the likelihood of a significant correction is low. At the same time, as the price continues to go up, money sitting on the sidelines is likely to FOMO into PUMP. The result is that PUMP’s price could go vertical and potentially hit new highs in the short to medium term. Multiple factors will likely keep sending PUMP higher going into the foreseeable future

Aggressive Buyback Program Pushing PUMP Higher

One of them is the fact that PUMP.Fun has an aggressive token buy-back program. Under the program, around $95 million has been spent to buy back tokens. The buyback program is effective because it occurs daily, regardless of the token’s intraday price action.

Data indicates that 6.58% of the total supply has been bought back, and the token amount in supply continues to shrink. This factor could see PUMP outperforming most altcoins because demand is increasingly chasing a shrinking supply. As FOMO builds up due to this program, PUMP could be headed to new highs in the short to medium term.

Pump.Fun Creator Payouts Adding to the Upside Momentum

Aside from the token buyback program, PUMP.Fun’s creator payouts and drawing in more developers to the PUMP platform. Through an initiative called Project Ascend, creators who use the Pump.fun platform to launch tokens and achieve a high market cap is rewarded with lower fees. The impact is that such creators can get better user engagement for their tokens, while also growing the market share of the PUMP.Fun platform.

The creator payout program is so successful that creators have claimed over $16 million in the past week. This, combined with the token buyback, has contributed to the more than 35% rally in the price of PUMP in the past week.

Macro Environment Supports Continuation of PUMP Rally

Besides these internal dynamics that are helping push PUMP higher, the macro environment could send PUMP to new highs. The US is expected to cut interest rates at some point this month. Investors expect this to inject liquidity into the markets and push risk-on assets to new highs. The result is that risk-on assets already showing bullish momentum could be headed much higher. For PUMP, which is already showing consistent gains for weeks, the odds are that a rate cut could send it on a parabolic bull rally.

Technical Analysis – Pump.Fun Trading In A Strong Bull Channel

PUMP has been on a solid bull run since August 26 when it bounced off the $0.0026 support. If PUMP bulls sustain the momentum built up so far, then PUMP could be headed to $0.01 in the short term. 

PUMP
Source: TradingView

On the other hand, if there is a correction, the key level to watch would be $0.0067, which is now a critical support level. A drop through this level could see PUMP drop to prices below $0.005 in the short term. Of these two scenarios, a rally to $0.01 is more likely due to a favorable macro environment and the token burn.

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