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Recent on-chain metrics indicate troubling signs for Toncoin (TON) holders, revealing significant losses and a concerning distribution phase that could impact future market trends.
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Despite an initial bullish outlook, the resurgence of whale selling has led to a swift downfall, with Toncoin’s value plummeting by 32% in just five days.
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According to a report by COINOTAG, “The current market dynamics suggest that short-term holders are dominating the sale, signaling a transition in market sentiment.”
This article explores the recent performance of Toncoin (TON), examining key metrics, whale activity, and market trends impacting investor sentiment.
Worrisome signs for Toncoin bulls
Toncoin’s recent price fluctuations have raised significant concerns among investors. After witnessing a promising rally towards the end of March, the overall sentiment has sharply declined. The bull run, which propelled Toncoin above the local resistance level of $3.95, has now been overshadowed by increasing selling pressure from whales. This behavior not only disrupts the bullish pattern but suggests that the asset may be entering a prolonged downtrend.
Whale Activity and Its Implications
The surge in whale activity is putting immense pressure on Toncoin’s price. Notably, daily transaction volumes have skyrocketed, yet this uptick is accompanied by alarming sell-off patterns. Recent data indicates that whale transactions have correlated with the asset’s decline, leading to a decrease of approximately 26.6% within eight days. This rise in selling activity may indicate that investors are capitalizing on their holdings before potential further declines.
Source: Glassnode
The Spent Output Profit Ratio (SOPR), crucial for assessing whether the coins are being sold at profit or loss, further underscores the mounting challenges for Toncoin holders. The recent dip below 1 indicates that a growing number of transactions are occurring at a loss, a stark indication of the prevailing bearish sentiment following the earlier recovery phase.
Long-Term Holder Behavior Shift
Examining the HODLer net position change reveals a troubling shift in market dynamics. During the months of February and March, long-term holders exhibited accumulation behaviors, contributing positively to price stability. However, recent metrics show a shift towards distribution, with long-term holders now liquidating positions, resulting in notable price declines. This behavior aligns with the observed increase in whale selling, indicating a potential market pivot that could have lasting implications.
Source: Glassnode
Source: TON/USDT on TradingView
As of this writing, Toncoin has not only breached its critical support level at $3.5 but shows no signs of recovery. The Chaikin Money Flow (CMF) has fallen to -0.14, indicating heightened selling pressure, which reflects the broader bearish trend dominating the market. Investors remain cautious, and any potential recovery appears distant amid ongoing distribution signals.
Conclusion
The current scenario for Toncoin holders is indicative of market instability and the potential for continued downward movement. As long-term holders alter their behavior while whales intensify selling, the outlook remains precarious. Investors should closely monitor on-chain metrics and market dynamics to navigate these turbulent waters effectively.
