The downside price pressure of STEPN (GMT), a widely talked about metaverse coin project of recent times, continues as one analyst calls STEPN “an exaggerated speculative frenzy.” The major downtrend witnessed in the last 30 days in STEPN (GMT) prices seems to be about to reverse.
Metaverse coin STEPN tries to recover
The price of GMT has rallied around 35 percent from $0.80 on May 27 to $0.99 on May 28. Interestingly, the upward pull started after the price fell into the same range that served as support before GMT’s 500 percent price rallies in March and 120 percent in May.
Additionally, the recovery is causing GMT to be oversold according to the daily relative strength index chart which fell below the oversold threshold of 30 on May 26. It was preceded by an 80 percent drop from its record high of $4.50 on April 27. Technical support indicates that GMT is in the process of bottoming out, in addition to the oversold RSI.
GMT price levels to watch
GMT charting a Fibonacci retracement from the $0.0099 low to the $3.82 swing high, the token 0.382 Fibonacci line (closer to $1.50) and It leaves within a wider consolidation range defined by the 0.786 Fib line (near $0.82), which acts as temporary resistance.
Therefore, an extended recovery from the $0.82 support level raises $1.50 as the next upside target, about 40 percent higher than today’s price. . Also, a strong upside trail could send the STEPN token to the $2-2.50 area, suggesting that the market has bottomed out. Conversely, a weaker upside trail could cause the price of GMT to retest $0.82 for a breakout move towards $0.54. As we reported on cryptokoin.com, this level was instrumental in limiting the token’s downward attempts between March 17 and March 21 earlier this year.
Is this metaverse coin a speculative frenzy
From a fundamental perspective, GMT’s bias seems skewed downward. First, the token is expected to be traded in near-perfect tandem with Bitcoin (BTC) and other top cryptocurrencies, according to reports of the daily correlation coefficient, which surpassed 0.98 on May 21, but fell to 0.75 on May 28. continues. Therefore, as many analysts think, if Bitcoin continues to struggle below $30,000, it could push GMT further down due to its consistent positive correlation with the token.
Second, GMT may decline due to growing uncertainties surrounding STEPN’s business model; this includes paying users to walk, jog or exercise with GST.
This model is not sustainable in the long run
Mike Fay, an independent market analyst and author of the Heretic Speculator financial bulletin, says STEPN’s so-called win-win model is neither scalable nor sustainable in the long run. The analyst touched on some key issues with the “lifestyle app”. First, STEPN has a huge barrier to entry because it allows people to acquire their expensive “Sneaker NFTs.” But even then, people buy these digital issues for hundreds or thousands of dollars, hoping that they will earn back their investment by earning and selling GST tokens. Many users have already gotten their money back, like YouTuber Sebbyverse, who claimed to have earned $219 worth of GST by just walking back and forth for 15 minutes for dinner. Fay said:
The likely way this will end is if the last people to enter the platform essentially serve as ‘exit liquidity’ for early adopters when the app’s in-game payment token (GST-USD) crashes.
This hurts the ROI for users who pay thousands of dollars for their Sneaker NFTs. So, according to Fay, if demand and incentive for NFTs falls, it will have difficulty attracting new players to STEPN implementation, thereby reducing demand for GMT. Fay also added:
STEPN is in an exciting speculative frenzy and I’m not buying any of that.
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