Is Toncoin’s Uptrend Sustainable Amid Resistance at $4 and Shifting Market Sentiment?

• Toncoin’s recent upswing has captured the attention of the crypto community, presenting a complex narrative of resistance, support, and market psychology.

• With a significant rally of 19.54% in just a month, Toncoin has emerged as a leading player among high-cap cryptocurrencies, yet challenges remain evident at the $4 mark.

• According to COINOTAG analysts, “The swift rejection at $4 signals that market participants may be in denial about the underlying trend exhaustion.”

Toncoin’s market dynamics show an intense battle at the $4 resistance, with shifting investor sentiment and whale accumulation influencing potential outcomes.

TON’s current market standing — Battling $4 resistance

On its 1D price chart, Toncoin retraced to $2.45, a key liquidity zone last tested in March 2024. The subsequent aggressive recovery pushed the asset toward a crucial point of resistance at $4, a level characterized by high volatility and significant sell-side absorption.

This latest attempt to break through the $4 barrier encountered immediate rejection, suggesting a possible liquidity grab rather than sustained buying pressure. The dynamics within the market indicate an ongoing struggle, bolstered by local distribution trends that could inhibit upward momentum.

As a result of this market behavior, short positions took advantage, leading to forced liquidations amounting to approximately $340 million. This deleveraging event has impacted the price, bringing it down to around $3.80 at the time of this report.

Source: TradingView (TON/USDT)

Currently, Toncoin is making another attempt to breach the $4 threshold. However, the supply zone at $3.93 is critical, encompassing 5.18 million addresses that collectively hold approximately 795.50 million Toncoin. A rejection at this level could trigger additional selling pressure, potentially leading to the risk of distributing about 3.12 billion TON.

Source: IntoTheBlock

Failure to maintain bullish momentum may lead to a short squeeze, pushing the market into a liquidity trap. However, there is a potential bright side; as market sentiment fluctuates into a denial phase, the question remains: will Toncoin holders display confidence in a breakout or face an inevitable consolidation phase?

Assessing Toncoin’s next move: HODL or capitulate?

Currently, whales dominate the Toncoin market by controlling approximately 66.77% of its total supply, making their trading behavior an essential indicator of market trends. An impressive 2159.82% increase in whale net inflows over the past week signifies robust accumulation, further signaling renewed buying interest.

This substantial whale activity coincides with Toncoin’s breakout from the $3.35 consolidation level, pointing to an increasing appetite for buying. Such trends suggest that significant holders are gearing up for the possibility of extending the bullish trend, potentially overlooking any emerging signs of reversal.

Source: IntoTheBlock

If this combination holds, and if Toncoin can effectively retest $3.93, a move beyond the $4 resistance zone appears increasingly probable. Additionally, a 7.70% rise in Open Interest in the derivatives market further supports this outlook. However, if the asset fails to hold above $3.93, it could lead to cascading liquidations, placing a substantial risk on current open positions.

A successful move above $4 must see capitulation managed effectively. While current signals lean bullish, keeping a close watch on these pivotal levels will be essential for investors in the near term.

Conclusion

The present landscape for Toncoin reflects significant investor activity and engagement, characterized by the tension between resistance levels and bullish sentiment. Whether Toncoin can ultimately break through key price barriers remains to be seen, but the interplay between whale actions and market sentiment will be pivotal. Vigilance in monitoring these critical resistance and support zones could offer crucial insights for traders moving forward.