Currently, Bonk [BONK] is teetering on the edge of establishing the $0.0000338 level as a strong support. Nevertheless, there has been a recent uptick in resistance at the 61.8% retracement level, with technical indicators signaling a slight advantage for the bulls.
With Bitcoin’s [BTC] positive performance leading up to the U.S. presidential inauguration on 20 January, there is some optimism for the memecoin. However, traders should remain cautious of a potential failed breakout if Bitcoin’s momentum shifts.
Is Another Rejection on the Horizon for BONK?
Analysis of the daily chart reveals a bearish trend following a lower low in the previous week. As of now, the price hovers just below the 61.8% Fibonacci retracement level at $0.0000338, with the RSI showing a tilt towards the buyers.
While the OBV has recorded an increase in the past month, it has failed to surpass a local high, indicating some bullish sentiment. Despite the wider losses in the memecoin sector recently, BONK buyers seem to retain some strength.
Key Resistance at $0.000037 for Bulls
On the H4 chart, a fair value gap (white box) is visible slightly above $0.00003, which previously served as a significant support level in late December.
Hence, a revisit to the FVG area or the $0.00003 level could potentially offer a favorable buying opportunity.
According to the 1-month liquidation heatmap, there is a cluster of liquidation levels in the range of $0.0000366-$0.0000374, aligning closely with BONK’s previous local highs at $0.000036 in early January.
In the days ahead, it is probable that BONK will gravitate towards the $0.000036-$0.0000374 range, providing traders with a chance to capitalize on profits. Swing traders, on the other hand, might consider long positions following a bullish breakout in the daily market structure and a rise in OBV beyond local highs.
Disclaimer: The opinions expressed in this article do not constitute financial advice; they reflect the author’s viewpoint.