BONK’s price has been facing minimal support from the market and investors even when other altcoins are charting rallies.
The meme coin stuck in consolidation has reached a point where it would need a massive push to break out.
BONK Investors Losing Hope
BONK’s price largely follows the broader market cues, and the lack of optimism there, combined with investors’ skepticism, is becoming a problem for BONK holders. The latter is evident in the funding rate of the asset.
The funding rate is a mechanism used in perpetual futures contracts to balance the market between long and short positions. It showcases which direction the traders are leaning in. Positive values suggest the dominance of long contracts, while negative hints at short contracts taking precedence.
In the case of BONK’s case, despite being positive, the funding rate is nearly at zero after recovering from negative last week. This means that the investors are not betting on a price rise as strongly as expected, likely owing to the lack of bullishness in the market.
This can be noted in the Average Directional Index (ADX), which has declined since mid-April. This indicator is used to identify the strength of a trend, whether it’s bullish or bearish.
As BONK’s price rallied on April 20, the ADX began dipping despite exceeding 25.0. This is the threshold for strength, and the indicator above 25.0 indicates that the trend is gaining strength.
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Thus, a decline during the rally is evidence that BONK did not have support from the market to complete a break out of the consolidation, and this may remain the case.
BONK Price Prediction: Look Down
BONK’s price trading at $0.00002320 is above the support of $0.00002153 after failing to breach the resistance at $0.00002840. These price points have been the limits of the consolidation for almost a month now.
While the meme coin failed attempts at breaching it, it successfully broke down below the support. Despite the recovery, BONK is closer to repeating a decline than breaking out of the consolidation.
Read More: 11 Best Solana Meme Coins to Watch in 2024
Thus, BONK holders should expect the same going forward.
However, a break out above $0.00002840 would invalidate the bearish-neutral thesis, potentially resulting in a rally of $0.00003000 and beyond.
Disclaimer
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