PYTH accelerates dramatically: What is the driving force behind the breakthrough?

Pyth Network (PYTH) continues to maintain its bullish momentum, recording an additional 2% increase on Monday, extending a nearly 10% breakout on Sunday. This bullish momentum is reinforced by the renewed activity on the network alongside a continuous increase in open contracts. Technically, the outlook still leans towards a positive trend as PYTH has just surpassed an eight-month resistance level, opening up new growth potential.

The increase in transaction volume – a signal that the network is operating robustly

According to data from DappRadar, activity on the Pyth Network has seen a significant breakthrough in the past 90 days. Just on Sunday, the network recorded up to 213,640 transactions – a notable increase compared to the 170,890 transactions on Wednesday of last week.

The strong increase in the number of transactions reflects the growing vibrancy in the user community, thereby contributing to the demand for the native token PYTH.

Pyth Network's on-chain activity | Source: DappRadar### Bullish sentiment drives OI skyrocketing

According to data from CoinGlass, the contract (OI) of PYTH has increased from 50.54 million USD on Sunday to 54.79 million USD. This significant increase reflects strong capital inflow into the derivatives market, indicating growing interest from traders in this asset.

Contract (OI) of PYTH | Source: Coinglass## The recovery momentum of PYTH aims for double-digit bullish levels.

As of the time of writing, PYTH continues to record a nearly 2% bullish, marking its seventh consecutive increase – extending an impressive recovery of 9.87% since Sunday. This momentum has helped the price surpass the 100-day exponential moving average at $0.1330, while also breaking through the resistance level that has lasted for eight months, established from the two peaks on December 3 and May 14, at the milestone of $0.1371.

However, the bullish trend is currently facing challenges at the key resistance level of $0.1489 - the previous peak formed on May 22. If the price can decisively close above this level, PYTH will have the opportunity to extend the breakout to the next target area at the Fibonacci 38.2% level, corresponding to $0.1684. This Fibonacci level is measured from the peak of $0.5533 ( on January 3, 2) to the bottom of $0.0807 ( on June 22, 6).

Daily chart of PYTH/USDT | Source: TradingViewHowever, a warning signal is emerging from the Money Flow Index (MFI) on the daily chart, as this indicator continues to rise and moves deeper into the overbought territory, currently reaching a level of 89. An MFI approaching 90 typically indicates that buying pressure has reached extreme levels and may not be sustainable, increasing the likelihood of a pullback or a short-term accumulation phase.

In a correction scenario, the 100-day EMA at $0.1330 may serve as short-term support. However, if the price slips below this line and the Fibonacci level of 23.6% at $0.1271, the previous breakout signal will be negated. At that point, a bearish trend may be reactivated, pushing the price further back to the 50-day EMA at $0.1179.

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