PNUT Reversal Arc: From Panic Low to 120% Rebound Potentia

The PNUT/TetherUS daily chart from May 10, 2025, presents a compelling case for a powerful recovery rally, despite today's sharp correction (-12.87% on 364.19M volume). While current price action appears bearish at first glance, the broader technical structure reveals an exceptional buying opportunity forming.

--- The Macro Technical Framework ---

The chart shows PNUT has been trading within a well-defined ascending channel (white boundaries) since the January 2025 low. What makes this pattern particularly significant is the recent development:

1. Major Breakout + Pullback Scenario - After breaking out from months of consolidation, PNUT has experienced a sharp pullback, creating the classic "shakeout before the breakout" pattern that often precedes major moves

2. Historical Supply/Demand Zone (purple rectangle) - The 0.55-0.60 region that previously acted as strong support before the late 2024 breakdown
3. Structural Support Level (gray horizontal line) - Additional confirmation of support around the 0.22 level

--- Technical Analysis: The Pendulum Swing Setup ---

The recent price action follows a textbook reversal pattern:

Phase 1: Accumulation & Breakout - The extended consolidation from January through April 2025, followed by the explosive green candle breaking above the channel's midline

Phase 2: Current Shakeout - Today's sharp 12.87% decline represents a classic shakeout move, designed to clear out weak hands before the next leg up

Phase 3: Projected Recovery (blue pathway) - The anticipated price movement shows:

- Pullback to the 0.2213 entry zone (confluence of channel support and horizontal support)
- Series of higher lows and higher highs as the pattern develops
- Ultimate target at 0.4671, representing a 111% gain from the projected entry

--- Why This Pattern Is Particularly Compelling ---

Three key factors make this setup exceptionally attractive:

1. Volume Profile Analysis - Despite today's negative price action, the volume signature shows characteristics of a selling climax rather than distribution, indicating potential exhaustion of sellers
2. Channel Integrity - The lower boundary of the ascending channel has held on multiple tests since January, establishing its significance as structural support
3. Historical Precedent - Similar pattern formations in PNUT during 2024 resulted in significant rallies after comparable shakeout moves

--- Strategic Entry Approach ---

The optimal strategy for this opportunity involves:

1. Waiting for the projected pullback to the 0.22 level, which provides both technical confluence and an excellent risk-reward ratio
2. Using a stop loss below the channel boundary (approximately 0.19) for clear invalidation
3. Taking partial profits at the mid-channel area (around 0.33) before allowing the remainder to run toward the 0.46 target

4H VIEW HERE


This technical setup suggests PNUT is preparing for a significant recovery rally over the coming weeks, offering a well-defined opportunity with precise entry, target, and invalidation levels.

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