Key Takeaways
PUMP rallied 20%, hitting a 2-month high of $0.006 before retracing to $0.0058. Pump.fun team has spent $2.5 million in token buybacks, with buyers scooping 7 billion tokens in 48 hours.
Pump.fun [PUMP] has continued with its remarkable recovery, rallying 20% to a 2-month high of $0.0060 before retracing to $0.0058 at press time.
Over the same period, the altcoin’s volume surged 161% to $522 million, while its market cap increased to $2.12 billion, indicating a capital inflow.
But what’s behind this strong uptick?
Pump buyers’ momentum soars
After a long period of sellers’ dominance, PUMP buyers have taken over the market to become a dominant player.
According to Coinalyze, PUMP has recorded three consecutive days of positive Buy Sell Delta.
Over this period, the altcoin saw a cumulative total of 7.03 billion in Buy Volume compared to 5.86 billion in Sell Volume.
Source: Coinalyze
As a result, the altcoin recorded a positive Buy Sell Delta of 1.17 billion, a clear sign of aggressive spot accumulation.
Additionally, the Pump.Fun team has allocated a substantial amount of funds for token buybacks.
According to Artemis, Revenue spent on buybacks surged 26% to $2.5 million, signaling a strong commitment to fuel momentum.
Source: Artemis
Often, market investors perceive this as a bullish sign, since the team is committing funds into the project.
On-chain network activity rebounds
Significantly, as PUMP’s upward momentum stabilizes, with sustained gains, its network activity has surged as well.
According to Santiment, the number of Daily Active Addresses surged to reach an all-time high of 33K, at press time, indicating a growing user base.
Such a spike in the active number of users indicated strong network participation.
Source: Santiment
Typically, when prices rise amid increasing demand, it indicates that current market conditions are supported by actual demand. Historically, such a setup has resulted in higher prices.
A start of a sustained rally?
According to AMBCrypto’s analysis, PUMP rallied as buyers dominated the market and increased capital inflow from token buybacks.
For that reason, the altcoin’s Stochastic RSI surged to 97, as of writing, reaching the overbought zone.
Likewise, its positive index of Directional Movement Index (DMI) rose to 34.5, further validating the uptrend’s momentum.
Source: TradingView
Typically, when these momentum indicators see such a setup, it signals trend continuation potential but also warns about looming volatility.
Having said that, if buyers continue to dominate the market, PUMP will reclaim $0.006 and target $0.0068 resistance level.
Conversely, if these buyers turn to selling, any downward pressure will see the altcoin drop towards $0.0050.
