Tron Price: Can Fundamental and Technical Factors Drive a Rebound?

Despite being in a bear market, Tron price has shown resilience in recent weeks. After falling over 40% from its highest level in 2024, the cryptocurrency has dropped to $0.2290. However, several fundamental and technical factors suggest that a rebound may be imminent.

Tron’s Growing Presence in the Stablecoin Market

According to TokenTerminal data, Tron has become the second-largest fee earner in the crypto industry, generating $330 million in fees this year. This growth is largely driven by its expanding presence in the stablecoin market, with a market cap of over $61 billion and a transfer volume of around $100 billion on Thursday alone. The number of USDT holders on Tron has also continued to grow, reaching over 60.4 million.

Staking Yields and Fee Distribution

Some of the fees generated on Tron are distributed to the network’s validators and holders through staking. According to StakingRewards, Tron’s staking yield stands at 4.5%, higher than Ethereum’s 3.12% and Sui’s 2.54%. This offers a lucrative opportunity for investors to earn passive income.

Deflationary Effect and Increasing Network Activity

Further fundamental factors that could drive TRX’s price higher in the coming months include the declining circulating supply. As more TRX tokens are burned than minted, a deflationary effect is created. The total number of TRX tokens in circulation has dropped to 86.11 billion, down from 86.15 billion a month ago. Additionally, Tron’s network activity has been increasing, with over 7 million transactions on Thursday, up from 5.4 million a week earlier.

Technical Analysis: Falling Wedge Pattern

The weekly chart shows that TRX has been forming a pattern of lower lows and lower highs since December, creating a falling wedge pattern. Historically, a falling wedge signals a potential breakout as the price nears the point of convergence. Tron has also found support at the 200-day exponential moving average, which it has failed to break below this month.

Tips for investors:

  • Monitor Tron’s staking yield and fee distribution to maximize passive income opportunities.
  • Keep an eye on Tron’s network activity and transaction count to gauge its growing adoption.
  • Watch for a potential breakout from the falling wedge pattern, with a potential target at its all-time high of $0.4485.

Given these factors, TRX could see a strong bullish breakout in the coming weeks. However, a drop below the 200-week moving average would invalidate this bullish outlook.

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