ONDO Faces Key Support Challenges Amid Correction and Whale Activity Decline

• ONDO faces a significant 18% correction today, cooling off after reaching a three-month high.

• For the first time in over two weeks, whale activity has decreased, indicating potential profit-taking by large holders.

• ONDO’s next significant price movement hinges on key support at $0.95, alongside possible bullish catalysts from macroeconomic factors.

Ondo Finance (ONDO) experienced a turbulent trading day after peaking, presenting a mix of opportunities and challenges for investors.

ONDO RSI Trends Downward Following a Surge

ONDO’s RSI peaked yesterday at 76.1 before declining to 54.8, signaling a potential shift in market dynamics.

The Relative Strength Index (RSI) is a crucial momentum indicator used in technical analysis, gauging the speed and changes of price movements. An RSI above 70 typically indicates that an asset is overbought and might retrace, while readings below 30 point to oversold conditions.

With ONDO’s RSI recently crossing the 70 threshold, traders had anticipated continued bullish momentum, but the subsequent retraction indicates potential profit-taking.

Source: TradingView.

The current RSI value reflects a cooling off period as it settles in neutral territory at 54.8, suggesting that the buying pressure may be diminishing. The ongoing progress of the RSI will be critical; a stable RSI above 50 could indicate the preservation of ONDO’s bullish structure, while a further drop could heighten the risk of additional downside movement.

Drop in Whale Activity Signals Potential Market Shift

Following a steady rise in the number of ONDO whales—wallets encompassing between 1 million and 10 million tokens—there has been a noticeable decline, with the count decreasing from 221 to 214.

This shift is pivotal as it reflects the sentiment of larger holders whose actions can significantly sway market prices. An increase in whale numbers typically indicates a bullish outlook, while a decrease can foreshadow potential distribution and increased selling pressure.

Source: Santiment.

While the decline in whale numbers is noteworthy, it remains higher than in previous months, hinting at ongoing investor confidence. The decrease in whale activity after a sustained period of accumulation may suggest profit-taking or a tactical repositioning by large stakeholders. Observing whether this trend persists or reverses will be critical, as declining whale numbers could contribute to further corrections in ONDO’s price.

Price Analysis: ONDO Falls Below $1

Yesterday’s market rally brought ONDO’s price close to $1.20 before significant profit-taking triggered a decline, raising questions about the asset’s immediate future.

Source: TradingView.

As ONDO drops below the $1 mark, its short-term outlook is closely tied to whether the recent correction extends deeper or begins to stabilize. Should the downward momentum continue, critical support levels to monitor will be around $0.95 and potentially further down at $0.90 or $0.88. A drop beyond $0.80 would mark a notable shift, as it would be the first such occurrence since November 2024.

Conversely, a resurgence of bullish sentiment—possibly fueled by favorable regulatory news regarding cryptocurrencies or ONDO’s acceptance into US strategic reserves—could enable a rebound, potentially pushing the price past resistance levels of $1.26 and $1.44, with further upward movement possibly targeting $1.66.

Conclusion

In summary, ONDO’s current environment is characterized by a significant price correction and shifting whale activity, both indicative of the changing market sentiment. The coming days will be crucial for assessing whether bullish momentum can resume or if selling pressure will continue to dominate, further influencing ONDO’s trajectory.