Bonk [BONK] has faced significant challenges, with its value dipping by 25.29%, leaving many investors in the red. However, recent price action suggests a potential recovery, with BONK showing a minor gain of 0.16% in the last 24 hours. Despite this slight positive movement, the memecoin’s rally remains uncertain, as misaligned trader sentiment could impede its upward momentum.
Bullish Signals Amidst Accumulation Phase
At the time of writing, BONK is trading within two bullish technical patterns: a larger descending channel and a consolidation phase. The descending channel suggests that buyers are bidding at increasingly lower prices before a potential rally. The consolidation phase, marked by a rectangular box, indicates price distribution between defined support and resistance levels, reflecting ongoing accumulation.
A breakout from this consolidation phase, coupled with a breach of the descending channel’s resistance line, could trigger a significant rally, pushing BONK to $0.00005666, marking a potential 78.65% gain. The Relative Strength Index (RSI), a key indicator of price momentum, supports this outlook, having recently bounced off the neutral line at 50 and standing at 53.89. When the RSI remains above 50, the chances of further price gains increase.
Additionally, the Aroon indicator confirms strong bullish momentum, with the Aroon-Up at 64.29%, indicating strong buying activity, and the Aroon-Down at just 21.43%.
Hesitancy and Potential Delay in Upswing
Despite the bullish signals, market hesitancy remains. Open Interest (OI) has dropped by 4.97% in the past 24 hours, signaling reduced participation from traders and a potential bearish sentiment shift. Furthermore, Exchange Netflow data shows a significant inflow of funds into exchanges, totaling $7.85 million in the past week—indicating increased selling pressure.
TVL Growth as a Positive Sign for BONK
On a more positive note, the Total Value Locked (TVL) of Bonk Staked SOL (bonkSOL) has surged to $23.59 million, the highest level since December 21st. This increase in liquidity is expected to benefit BONK, potentially providing a foundation for the memecoin’s recovery.
Also Read: Bonk (BONK) Set for 250% Rally As Whale Interest and Strong Support Signal Upside
While uncertainties remain, BONK‘s technical indicators and growing liquidity suggest that a breakout could be on the horizon if buying pressure continues to build.
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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