Over the weekend, I noticed a 2% drop in Toncoin‘s price to $5.8, which seemed to mirror a broader trend of selling across the crypto market. The fall was particularly noticeable with leading cryptos like Bitcoin and Ethereum dipping below $60,000 and $2,700 respectively. This downward movement appears to be fueled by intensifying geopolitical tensions in the Middle East. In this volatile market, Toncoin’s continued stay below the breakdown point of a bearish pattern raises concerns about potential further declines in its price.
Toncoin Price Poised For Prolong Downfall
In simpler terms, the graph of Toncoin’s price is demonstrating a popular pattern known as “head and shoulders” on its daily chart. This pattern is made up of three distinct high points. The central peak, referred to as the ‘head’, is the highest among the three, while the two outer peaks, or ‘shoulders’, are roughly equal in height and lower than the head.
In my analysis, as patterns emerged and the market underwent correction, I observed a significant drop in the altcoin’s price from $8.17 to $6.107, representing a substantial loss of approximately 26%. This downward trend also led to a decrease in the market cap, which now stands at around $14.9 Billion. The price decline provided a clear breakdown from the neckline support at $6.5, thereby intensifying the selling pressure within the market.
A surge in the ADX slope to 30% signifies a significant correction’s power, with sellers exerting considerable control over this particular asset at present.
In simple terms, the funding rate for Toncoin’s derivative market is currently -0.31, which means short sellers are having to pay a fee to hold onto their positions. This suggests that there’s a strong belief among traders that Toncoin’s price will continue falling, reflecting a bearish outlook.
As an analyst, I project that if Toncoin forms a head and shoulders pattern, the potential downside could be around 24%. To calculate this, I measure from the peak of the ‘head’ to the ‘neckline’, then extend that distance from the point where the price breaks the neckline. This would roughly position the support level at Toncoin’s projected low in May 2024, approximately $4.6.
Additionally, it’s worth noting that the Total Value Locked (TVL) within the Toncoin network has experienced a sudden decrease from $760 to $676, representing a drop of 11%. This decline in TVL suggests a significant shrinkage in liquidity and potentially lower investor trust, which might worsen the already bearish sentiment.
Instead, if we take a different perspective, a decline in Toncoin’s price might lead to increased demand around the level of $5.56, which aligns with the slope of the 200-day Exponential Moving Average (EMA). This potential rise could counteract the bearish trend and propel Toncoin’s price beyond $7 following a 16% increase.
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2024-08-04 22:36