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Memecoin BONK is showing signs of a potential rally, breaking out of a downtrend while traders eye crucial support levels for future movement.
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Despite recent market volatility, analysts predict a bounce back for BONK, which is currently testing the $0.0000091 support threshold.
Explore the latest insights on BONK’s market dynamics, including potential price rallies and critical support levels to watch for potential investments.
BONK breaks out of downtrend
The BONK/USDT daily chart recently demonstrated a breakout from a defined descending channel, signaling potential recovery for this memecoin. The price had observed a downtrend, characterized by lower highs and lower lows, but has now surpassed the channel’s upper trendline.
A pivotal support level at $0.00001570 has emerged as a foundational benchmark, halting further declines. If momentum continues to build, BONK may set its sights on the $0.00005900 resistance zone, which signifies a possible 271.64% price increase from the breakout level.
Source: TradingView
Indicators show early signs of strength
Technical indicators are revealing early signs that selling pressure might be diminishing. Current analysis of the Bollinger Bands indicates a period of low volatility, with BONK trading near the middle band at $0.00001589. A movement above $0.00001816 could confirm a trend reversal.
However, if BONK fails to maintain its current levels, it may face another test of the $0.00001402 support.
Source: TradingView
The Relative Strength Index (RSI) stood at 32.38 at press time, indicating a move away from oversold conditions. A cross above the 40-50 mark could highlight a growing appetite among buyers. Additionally, the MACD indicator is approaching a bullish crossover, with the MACD line at -0.00000258 nearing the signal line at -0.00000279, suggesting that momentum is shifting in favor of buyers.
Funding Rate and market sentiment
Current market data presents a mixed sentiment among traders. Reports from Coinglass indicated that BONK’s trading volume has increased by 4.66% to $25.29 million, while Open Interest rose by 4.30% to $9.86 million.
The OI-Weighted Funding Rate is recorded at -0.0089%, indicating that those holding short positions are compensating those holding long positions. Traders should exercise caution, but a shift to a positive funding rate could signal a renewed bullish sentiment.
Source: Coinglass
Key support needed for potential bounce
In light of recent losses, analysts are keeping a vigilant eye on BONK’s $0.0000091 support level, which was last assessed in February 2024. Crypto analyst gnarleyquinn mentioned that if BONK can hold this level, it may present an attractive buying opportunity.
Similarly, analyst Ali Martinez stated,
“If BONK maintains this support level, a potential bounce could follow.”
Market participants will closely observe whether this recovery can gain substantial momentum.
Conclusion
In summary, while BONK has experienced recent volatility, key support levels and breaking out of a downtrend suggest opportunities for a potential rally. Observing trading patterns and market sentiment will be pivotal in determining the next moves for this memecoin.
