|
Getting your Trinity Audio player ready...
|
- BONK has retraced 44% since July but now sits at a major support level.
- Declining trading volume raises caution despite technical support confluence.
- Bitcoin dominance drop may aid altcoin momentum if reversal gains traction.
Bonk [BONK] is testing a critical support zone after retracing nearly 44% from its July rally highs. The popular Solana-based memecoin has faced increased selling pressure amid Bitcoin’s short-term bearish bias, but its current position suggests the next move could be pivotal.
Bitcoin Dominance Declines, Altcoins See Growing Interest
Bitcoin dominance (BTC.D) has been on a steady decline in recent weeks, falling below a multi-year support level from 2020. Historically, a downtrend in BTC dominance signals stronger capital flow into altcoins, potentially boosting tokens like BONK.
The memecoin sector as a whole has also seen gradual growth. Since March, the memecoin market cap has risen steadily, standing at $71.41 billion. However, it still remains well below its $115-billion peak from late 2024, showing there is room for expansion if momentum picks up.
BONK Price Structure Remains Bearish in Short Term
On the 1-day chart, BONK’s market structure remains bearish. August saw a new lower low, with the Awesome Oscillator confirming negative momentum. This suggests further downside risk remains if buying pressure fails to return.
Adding to concerns, trading volume has been declining, a sign of reduced participation. The A/D (Accumulation/Distribution) indicator reflects this trend, underlining the need for stronger inflows before any sustainable reversal can occur.
Critical Support Zone Could Spark Rebound
Despite the bearish structure, BONK is trading at a historically significant support level. The $0.0000225 zone, previously a resistance during July’s rally, is now acting as a bullish breaker block.
Also Read: BONK Price Crashes 50% as Pump.fun Dominates Solana Memecoin Market
This support area also aligns with the 61.8% Fibonacci retracement level and the 100-day moving average — both adding confluence to the idea that BONK may attempt a rebound. If trading volumes pick up, this zone could serve as the foundation for another rally attempt.
For now, BONK sits at a crossroads. A breakdown below support could open the door to deeper losses, while a strong bounce with renewed trading activity may set up a reversal toward $0.00004 and beyond. Traders should remain cautious but alert for bullish signals as the memecoin tests this critical level.
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
I’m a crypto enthusiast with a background in finance. I’m fascinated by the potential of crypto to disrupt traditional financial systems. I’m always on the lookout for new and innovative projects in the space. I believe that crypto has the potential to create a more equitable and inclusive financial system.
