BONK, the popular memecoin, has seen a rough week, dropping over 8.31% in the past seven days. The pain continued in the last 24 hours, with BONK losing 3.5% of its value and currently trading at around $0.00001812. This price decline was accompanied by a significant 31.75% drop in trading volume, suggesting continued bearish pressure.
However, a recent analysis by AMBCrypto offers a glimmer of hope for BONK investors. While acknowledging the current downturn, the analysis suggests it might be temporary. Here’s why:
Potential Bullish Signs Despite Price Dip
While BONK’s price hit a new low at the time of writing, the Accumulation/Distribution (A/D) line displayed surprising resilience. Unlike the price, the A/D line hasn’t mirrored the decline, indicating a potential disconnect. This suggests that the downward price movement might not be fully backed by trading volume. This could be interpreted as either sustained buying interest or less selling pressure than initially perceived.
Furthermore, BONK has been bouncing back from a historically significant support level. This level has, in the past, triggered upward rallies, adding fuel to the potential bullish outlook.
Fibonacci Retracement Paints a Possible Path
AMBCrypto’s analysis delves deeper, utilizing the Fibonacci Retracement tool to identify potential future price points as BONK gears up for a rally. Two critical levels emerge:
- The first resistance zone sits at $0.00001987. Here, the price might stabilize before gathering further bullish momentum.
- If the momentum is strong enough, BONK could target the next significant resistance at $0.00002255, an area historically associated with selling pressure.
However, if buyer interest wanes, the price could retreat to the support level of $0.00001554, as indicated by the Fibonacci Retracement.
Data from Coinglass paints a positive picture. Both whales (large-volume buyers) and retail traders seem optimistic about BONK’s potential for an upswing. Open Interest (OI), representing the total number of unsettled derivative contracts, saw a significant increase of $1.13 million between August 12th and 21st. This surge in OI signifies growing interest among traders. Rising OI often translates to increased market participation and potential upward momentum, suggesting strong commitment from buyers.
Also Read: BONK Breaks Crucial Fibonacci Level – Experts Predict 20% Price Drop
Additionally, negative inflows suggest that more BONK tokens are being withdrawn from exchanges than deposited. This trend reinforces investor confidence and bullish sentiment by reducing the supply available for trading, potentially pushing the price up.
BONK Rally on the Horizon?
While the current market conditions present a challenge for BONK, the indicators discussed above suggest a potential price rally on the horizon. However, the success of this rally hinges on the continuation of these bullish trends. Investors should closely monitor price movements, trading volume, and investor sentiment to make informed decisions.
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.
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