Bonk (BONK), the Solana-based meme coin, is one of the top cryptocurrencies registered a notable price increase recently. On July 16, BONK’s price fell from $0.000028 to $0.000025.
One day later, the token’s price revisited the peak mentioned above. But here’s why BONK’s uptrend may briefly pause before it continues to swing higher.
Rally Subsides Amid Bearish Sentiment
BONK’s remarkable surge came with an unprecedented rise in trading volume. However, the volume has fallen at press time, suggesting that the uptrend is weakening.
A look at the daily chart gives more insights into the price action of the “Solana dog for the people, by the people.”
Firstly, BeInCrypto observed that the meme coin has formed an inverted cup and handle pattern on the chart. This technical pattern is the opposite of the regular cup and handle formation.
Unlike the latter, the inverted cup and handle pattern marks the end of an uptrend. Technically, the price declines after it reaches a new high, as shown below.
Beyond that, BONK may continue to lose its upward momentum. If validated, the next move for BONK may be consolidation, which sees the price move between $0.000022 and $0.000025.
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However, the uptrend will continue after consolidation, depending on where bulls find strong support.
Another factor aiding the prediction is the Weighted Sentiment. According to Santiment, the Weighted Sentiment around the token stands at -0.49.
This metric gauges the perception market participants have about a project online. If the reading is positive, most comments about the cryptocurrency are bullish.
However, in BONK’s case, the negative reading implies that the social media discussions about the meme coin are mostly bearish.
Should this sentiment remain the same, demand may deteriorate, giving credence to the prediction that BONK will move sideways for some time.
BONK Price Prediction: Momentum Fades, $0.000024 Next?
Apart from the sentiment displayed, the indicators on the daily chart align with the forecast above.
For instance, the Relative Strength Index (RSI), which measures momentum, initially ran to 60.45. But it has retraced to 56.83 at press time, indicating a waning bullish momentum.
In addition, the Directional Movement Index (DMI) suggests a similar movement. The DMI measures the strength and direction of a token’s price.
As of this writing, the +DMI (green) is higher than the -DMI (red), meaning buyers had more strength than sellers. However, for BONK’s uptrend to continue, the Average Directional Index (DMI) has to support the rise.
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For that to happen, the ADX (yellow) has to be at a reading of 25.00 or above. But it is lower at press time, reinforcing the notion of a consolidation or downtrend.
According to the Fibonacci retracement tool, BONK’s next target could be $0.000024. However, this prediction will be invalidated if meme coins begin to lead the broader bounce again.
If this happens, the price of BONK will retest $0.000028, and a move to $0.000031 will become feasible.
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Disclaimer
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