Bonk, the Solana blockchain’s second-largest meme coin, recently experienced a 4% dip in its 24-hour trading price, settling at $0.0000448. Trading volumes also declined by 40%, mirroring a broader market downturn. Despite this momentary setback, BONK remains a top performer in 2024, boasting a year-to-date gain of over 200%.
A Double-Bottom Pattern: A Bullish Signal?
BONK’s one-day chart has formed a double-bottom pattern, a technical indicator often signaling a potential reversal from a downtrend to an uptrend. The meme coin reached its peak within this pattern on November 20, hitting an all-time high of $0.0000623. After a subsequent dip and the formation of a neckline at $0.000046, BONK is currently retesting this resistance level.
A successful breach of this resistance, coinciding with the double-bottom pattern’s neckline, could trigger a rally surpassing the previous ATH. Conversely, a failure to break this resistance and a drop below the $0.000040 support level would invalidate the bullish thesis and potentially initiate a downtrend.
Technical Indicators: A Mixed Bag
Technical indicators provide a mixed outlook. The Money Flow Index (MFI) has been trending upwards, indicating strong buying pressure and increasing capital inflow into BONK. The MFI’s current reading of 67 suggests bullish momentum without reaching overbought territory.
The BBTrend indicator confirms a bull market, although fading histogram bars hint at potential weakening momentum.
Derivative Market Activity: A Potential Roadblock
Derivative trading volumes surrounding BONK have significantly decreased in recent weeks, as highlighted by Coinglass data. These volumes reached record highs in mid-November during BONK’s ATH rally. Additionally, open interest has declined from $64 million to $26 million in three weeks, signaling reduced market participation.
Without a resurgence in speculative activity, BONK may become trapped in a range-bound consolidation phase.
The Battle for Top Spot: BONK vs. WIF
BONK briefly surpassed dogwifhat (WIF) in November to claim the title of Solana’s largest meme coin. However, WIF has since reclaimed its top position with a market cap of $3.68 billion compared to BONK’s $3.34 billion.
A successful rally past the $0.000046 resistance and confirmation of the double-bottom pattern could fuel BONK’s uptrend in 2025, potentially boosting its market cap and enabling it to once again dethrone WIF.
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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