Highlights:
- BONK broke below 100 MA and double top resistance, signaling a bearish trend shift.
- BONK hit critical support at the 78.6% Fibonacci level, indicating potential bounce.
- Momentum indicators show oversold levels, hinting at possible short-term recovery.
BONK, a fast-growing meme coin, has recently dipped in price and dropped below some important technical levels. This drop made traders and investors wonder if the cryptocurrency will bounce back from the current lows.
BONK Price Double Top Breakdown and MA 100 Breach
Notably, BONK price chart showed that the recent price movement formed a bearish double top, a signal that the meme coin might drop further in the coming days. In this case, BONK price dropped steeply right after it touched the 0.000002150 USDT level.
The double top breakdown indicated that buyers could not break through a key resistance, which led the trend to reverse.
Adding to the bearish sentiment, BONK dropped below its 100-day moving average, often seen as an important support level for the coin in the long term. This breakdown showed that the meme coin might be losing momentum. The failure to reclaim this level indicates waning bullish interest, increasing the likelihood of further downside.
Testing Key Fibonacci Support Levels
As the selling pressure kept growing, BONK reached a level where it was just a few points away from a major support area marked by the 78.6% Fib retracement line. This level, which many traders pay close attention to, can be an important stop-loss point when the market is going down hard.
Historically, the 78.6% retracement level is often seen as a key point when the market may start to reverse, so traders often look for rebounds around this area.
Despite the dips, BONK could still bounce back based on its recent price decline. The presence of buyers at this level could help start a market rebound if things get better overall.
However, if the support breaks, the cryptocurrency could go lower and might even hit Fibonacci levels from before or old support areas.
Momentum Indicators Signal Potential Bounce
More so, momentum indicators on the BONK price chart have shown a bearish trend. The Relative Strength Index (RSI) is approaching oversold territory.
This technical condition often signals that selling pressure may be overextended, creating the potential for a short-term bounce as traders seek to capitalize on discounted prices.
Additionally, the Moving Average Convergence Divergence (MACD) on the BONK 4-hour chart showed that there has been a recent bearish crossover, where the MACD line has moved below the signal line.
This crossover showed that bullish momentum was getting weaker and could result in the price trend moving lower. Additionally, the histogram dropped into negative territory, showing that more selling dominance.
Moreover, the Bull Bear Power (BBP) indicator for BONK on the 4-hour chart was in negative territory, reflecting stronger bearish pressure. This negative reading indicated that sellers have taken control, driving prices lower as the bears dominate market sentiment.
For a potential reversal, bulls need to reclaim strength, pushing the BBP back into positive territory, which would signal a shift in momentum and possible price recovery.
Meanwhile, a bullish divergence in some momentum metrics might mean that bearish momentum is starting to fade, so the market could see a small rebound. However, for BONK to recover, it will need to break above important resistance points like the 100 MA, which currently acts as a tough level to move up from.
At press time, BONK price was trading at $0.00002137, down 1.28% over the past 24 hours. Its market cap stood at $1.69B, with a 24-hour trading volume of $371.4M, reflecting an 8% drop.