PUMP - -1132.01% in 24 Hours Amid Sharp Corrections

On SEP 25 2025, PUMP experienced a drastic 1132.01% decline within 24 hours, closing at $0.004972. Over the past seven days, the token plummeted by 2843.64%, while showing a 1101.73% gain over the last month and a 1101.73% increase over the past year. The sudden and extreme 24-hour drop has drawn attention from crypto analysts and traders, with many reviewing the technical underpinnings of the price movement.

The correction followed a prolonged period of bullish momentum, culminating in a sharp reversal. Chart analysts have identified a breakdown below key support levels, suggesting a shift in market sentiment from optimism to caution. The price action aligns with bearish reversal patterns, raising concerns about potential further declines if the new level fails to hold.

Technical indicators show that the Relative Strength Index (RSI) for PUMP has entered oversold territory, suggesting a potential short-term rebound. However, the Moving Average Convergence Divergence (MACD) continues to show bearish momentum, with the histogram reflecting a widening divergence. The 200-day moving average, which has acted as a psychological benchmark, was decisively breached during the 24-hour plunge, signaling a potential bear market entry.

In addition, on-chain metrics reveal a significant drop in active addresses and reduced transaction volume, indicating a withdrawal of retail and institutional liquidity. While the long-term outlook remains clouded by this sharp correction, the 1-month and 1-year returns suggest the token has retained significant value over a broader time horizon.

Backtest Hypothesis

To assess the effectiveness of potential trading strategies amid such sharp volatility, a backtesting framework was applied. The model focuses on capturing short-term price rebounds after extreme corrections, leveraging the RSI and MACD as primary entry and exit signals. The hypothesis assumes that after a 50% drop in RSI into oversold territory, a long position is triggered when the RSI crosses back above 30, provided the MACD line crosses above the signal line.

The strategy also incorporates a trailing stop loss at 10% of the entry price to manage downside risk. Exit points are determined by a combination of RSI divergence and MACD crossover, aiming to capture rebounds without being overly exposed to subsequent corrections. This backtest is designed for a 20-day holding period, with positions closed if the RSI fails to maintain above 40 for two consecutive days.