- BONK has been trading within a descending channel for a month
- Liquidation cluster near the channel highs could pull the price higher in the coming days
Bonk [BONK] has continued to exhibit a bearish facade on the 1-day timeframe. Over the past month, the $0.0000099-level has been tested twice. This level was a crucial support back in January 2024. If the prevailing downtrend continues, the 2024 low might be surpassed by BONK‘s bears.
BONK tries to form a long-term bottom above the early 2024 support level
Since March, a descending channel has appeared to be in play. The mid-channel level (dotted white) has served as resistance and support. The rejection from the channel high on Sunday meant that the mid-channel level would be the next short-term target.
The RSI climbed above neutral 50 over the past week as the price bounced from the $0.0000099-level. This underlined a change towards bullish momentum, but it was unclear if it would remain in place.
Instead, it is more likely that the bearish trend would remain in place till a structure break could occur on the back of convincing buying pressure. At press time, the buying volume had not begun to trend upwards.
The OBV was hovering around its February and March lows. This was a sign that despite the price bounce last week, the demand for BONK was absent. Therefore, traders can use any price bounces to look to sell the memecoin short.
Source: Coinglass
The liquidation heatmap revealed that there were two levels of importance around the market price. The closest one was at $0.0000113, just below the price at press time. Although it was not as dense as the one at $0.000014, its proximity makes it a likely short-term destination for BONK. The $0.000014-level coincided with the channel highs and could be the target after a retest of the mid-channel support.
A bounce from the $0.000011 area might be likely, as it had confluence with the mid-channel support. Since the market structure has been bearish, traders should wait out a price bounce and look to trade with the trend.
Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion
