Over the last month, Bonk [BONK] has faced challenges, experiencing a 25.29% decline and offering limited returns for investors. Despite this, recent price fluctuations indicate a slight recovery, with the asset showing a 0.16% increase in the past 24 hours.
CryptoCrypto has identified significant positive signals backing the recent uptrend in BONK. Nevertheless, the durability of BONK’s surge could be uncertain due to conflicting trader sentiments, creating a potential barrier.
Observing a Double Bullish Pattern within the Accumulation Phase
Currently, BONK is trading within two bullish patterns: a broader descending channel and a consolidation period within the channel, indicating ongoing accumulation.
The descending channel commonly signifies recurring lower lows as buyers engage at descending prices before a market recovery occurs. Inside this formation, the consolidation phase, defined by a rectangular shape, demonstrates price distribution between specific support and resistance levels.
An escape from this consolidation phase and breaking through the resistance line of the descending channel might potentially trigger a notable rally for BONK, targeting $0.00005666—an increase of 78.65% from its present level.
Technical indicators lend support to this positive outlook. The Relative Strength Index (RSI), measuring price momentum, has rebounded effectively off the neutrality threshold at 50 and currently stands at 53.89, implying an upward trend.
When the RSI remains above 50 and rises, as is the case for BONK, the probability of sustained price growth rises.
The Aroon indicator further confirms the prevailing positive momentum. The Aroon-Up (orange) is at 64.29%, surpassing the Aroon-Down (blue) at 21.43%, signaling robust buying activity and indicating that BONK continues its accumulation phase.
The Aroon indicator tracks trend strength and direction by gauging the time elapsed since recent price peaks and troughs.
However, CryptoCrypto has noted some market hesitancy, with specific segments showing indications of selling pressure.
Possible Delay in BONK’s Upward Movement
The memecoin could encounter a temporary halt or slowdown before resuming its upward trajectory.
At the moment, Open Interest (OI) has decreased by 4.97% in the past day, falling to $12.15 million. A drop in OI typically signifies a bearish sentiment, indicating reduced trader engagement or exiting of positions.
Furthermore, Exchange Netflow data reflects unfavorable trends for BONK, with a substantial influx of funds into exchanges amounting to $7.85 million over the previous week.
This movement portrays escalating selling pressure as more market participants transfer assets to exchanges.
If these trends persist, BONK could remain in its consolidation phase for an extended period before breaking out upwards. However, increased buyer activity and asset accumulation could expedite the resumption of the memecoin’s rally.
TVL Growth for BONK
The Total Value Locked (TVL) of Bonk Staked SOL (bonkSOL), a liquid staking token (LST) associated with BONK validators, has witnessed a significant surge.
As of the latest data, the TVL has reached $23.59 million, marking its highest point since December 21.
This substantial influx of liquidity into the memecoin’s validator pool is anticipated to generate a positive ripple effect on BONK itself.