In recent times, meme-based cryptocurrencies have faced challenges, and BONK has not been immune to this trend, seeing a decline of -8.61% in the past week. Nevertheless, recent price movements hint at a possible change in momentum.
At the time of writing, BONK was trading at $0.00001584, with a daily trading volume of $115.73 million and a market capitalization of $1.22 billion.
BONK Breaks Free from Downtrend
Analysis of the BONK/USDT daily chart reveals a breakout from a descending channel, indicating a potential recovery. Previously, the price had been on a downward trend, forming lower highs and lower lows, but has now breached the upper trendline of the channel.
A significant support level at $0.00001570 has acted as a base, preventing further downward movement. Should the momentum continue, BONK might target $0.00005900, identified as a major resistance zone, representing a potential price surge of 271.64% from the breakout level.
Indicators Point to Strength
Technical indicators suggest a possible easing of selling pressure. The Bollinger Bands reflect low volatility, with BONK trading close to the middle band at $0.00001589. A move above $0.00001816 could confirm a reversal in the trend.
However, a failure to hold current levels might result in a retest of the $0.00001402 support level.
The Relative Strength Index (RSI) stood at 32.38, hinting at a departure from oversold conditions. A crossover above the 40-50 zone could signal heightened buying interest.
Additionally, the MACD was nearing a bullish crossover, as the MACD line approached the signal line, indicating a potential shift in momentum in favor of buyers.
Funding Rate and Sentiment in the Market
Market sentiment appears mixed among traders. Coinglass data indicates a 4.66% increase in BONK’s trading volume, reaching $25.29 million, with Open Interest rising by 4.30% to $9.86 million.
The OI-Weighted Funding Rate currently stands at -0.0089%, implying that short positions are paying long positions. Traders should exercise caution, though a shift to positive funding rates could signal a return of bullish sentiment.
Crucial Support for a Possible Rebound
Despite recent setbacks, analysts are closely monitoring BONK’s $0.0000091 support level, last tested in February 2024. Crypto analyst gnarleyquinn has suggested that a successful defense of this level could present an excellent buying opportunity.
Ali Martinez shares a similar view, stating,
“A potential rebound could occur if BONK manages to hold this support level.”
Traders will be observing attentively to see if this recovery gains momentum.