Bullish patterns in Trump Coin face whale-sized risks

Trump Coin faces serious headwinds that could limit its upside in the near term. Here’s the breakdown.

Trump Coin bulls beware

The Official Trump (TRUMP) meme coin price has remained in a tight range in the past few months. On the positive side, it has formed a double-bottom pattern at $8 and a neckline at $11.90. This pattern often leads to a strong bullish breakout as it signals that bears are afraid of shorting it below that price.

Trump Coin price has also formed a falling wedge pattern whose two lines are about to converge. This pattern typically leads to more gains over time. Most importantly, the Relative Strength Index and the MACD indicators have formed a bullish divergence pattern.

Therefore, technicals suggest that the Trump meme coin will rebound in the near term. If this happens, the next important level to watch will be the double-bottom neckline at $11.90. 

Whale dumping could spoil the momentum

The strong technicals, however, may not be enough to boost the Trump Coin price amid weak fundamentals. First, Nansen data shows that whale investors have been selling the tokens in the past few months. These investors now hold 4.96 million coins, down from the August high of 5.87 million. 

Second, the number of Trump coins on exchanges has continued to rise in the past few months. There are now 128.4 million coins in exchanges, mostly in Binance, Robinhood, and OKX. The supply has increased from the June low of 118 million. Soaring exchange outflows is risky because it sends a signal that many investors are selling their tokens. 

The other risk is that there is an increased supply of the token, with most of them going to the Trump family. There are 199 million TRUMP tokens in circulation, meaning that 800 million more will be unlocked in the next few years. Token unlocks often lead to lower prices by increasing the supply.

How Trump Coin became a thing

The Official Trump meme coin was launched on Jan. 17, just days before Donald Trump’s inauguration as the 47th U.S. president. The coin debuted on the Solana blockchain, with 200 million tokens released to the public in an initial coin offering (ICO) and the remaining 800 million held by Trump-affiliated entities, CIC Digital LLC and Fight Fight Fight LLC.

This strategic timing leveraged the heightened media attention surrounding the inauguration, contributing to the coin’s rapid rise in value.

Since then, Trump’s meme coin has generated substantial profits, combining trading fees and the value of his personal holdings. Estimates from financial outlets such as the Financial Times and the New Yorker put his gains at around $350 million in March, rising to $385 million by August.

Overall, the Trump family has gained an estimated $5 billion from their holdings in a separate crypto venture called World Liberty Financial. The firm’s WLFI token began trading on Sept. 1. The family’s stake is sizable—but subject to the usual cryptocurrency volatility.

What critics say

Trump’s critics claim that the family’s WLFI venture and its Trump Coin venture operate like “pay-to-play” schemes. Key concerns include:

• Pay-for-access dinner: In May, Trump hosted a Virginia golf club dinner for top $TRUMP investors, offering personal access in exchange for investment.
• Foreign investment and policy influence: In May, an Abu Dhabi-backed fund used the WLFI stablecoin to invest $2 billion in Binance, while the Trump administration maintained a hands-off stance on crypto regulation, raising conflict-of-interest concerns.
• Favored treatment for major investors: Regulators reportedly paused a fraud investigation into TRUMP investor Justin Sun shortly after his significant investments in Trump’s crypto ventures.