Bonk (BONK) closed at a multi-month high of $0.000041 on May 28, and its price has since fallen to form a descending channel.
With its price trending toward the lower line of this channel, the meme coin is poised to breach support and fall further.
Bonk Trades Under Key Moving Average
A descending channel is a bearish signal. When an asset’s price trends within this channel, it consistently moves lower, creating a series of lower highs and lower lows.
The upper line of the channel forms resistance. In BONK’s case, this is $0.000044. The lower line represents support; for BONK, this is $0.000023. Since the meme coin began its descent from the $0.000041 price mark, its value has dropped by 36%. At press time, BONK trades at $0.000026.
The meme coin trades below its 20-day Exponential Moving Average (EMA), which tracks BONK’s average price over the past 20 days and emphasizes its recent prices.
When an asset trades below this key moving average, it confirms that it is in a downtrend, as recent prices are lower than the average of the past 20 days.
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BONK’s daily chart readings showed that it has traded below the 20-day EMA since June 6. It is key to point out that persistent trading below the 20-day EMA can indicate sustained selling pressure, which might attract more sellers or cause current holders to sell in fear of further declines.
BONK Price Prediction: Why the Bulls Must Defend the Support Level
The bearish bias trailing BONK is confirmed by its negative weighted sentiment. This on-chain metric has returned only negative values since May 30. At press time, it is -0.86.
Bonk Weighted Sentiment Source: Santiment
This metric measures the overall market sentiment about an asset. It, however, goes beyond a simple positive/negative count for a particular asset. It considers both the sentiment strength and the volume of mentions.
When its value is negative, as in BONK’s case, it suggests a high volume of discussion around the asset, most of which express negative opinions and lack confidence.
If this sentiment continues to trail BONK, and buying pressure keeps waning, the bulls may be unable to defend support, causing it to trade at $0.000021.
However, if sentiment improves and buying momentum skyrockets, the altcoin may rally toward $0.000027.
Bitrue