Key Takeaways
BONK had a bearish market structure on the 1-day chart, but a bullish reversal from its nearby liquidity pocket might be a possibility traders should look out for.
BONK registered a 20% hike in daily trading volume, according to CoinMarketCap. That’s not all though as the memecoin has shed nearly 12% of its value since 01 September, falling below a key support level at $0.0000226.
In a recent report, AMBCrypto also compared the momentum of other popular memecoins, Shiba Inu [SHIB] and Pepe [PEPE]. Whale buyers for SHIB and retail for PEPE could drive a breakout past key resistance levels.
In comparison, BONK’s fall below $0.00002 has been a blow to holder confidence. Hence, more losses may be likely to follow.
Volume Profile highlights BONK trend
Source: BONK/USDT on TradingView
The Fixed Range Volume Profile tool was plotted from the start of the rally in late June to present day. It showed that the Point of Control (red) was at $0.0000224. This was close to the $0.0000226-support level, which was also a key Fibonacci retracement level.
BONK’s drop below the Point of Control took it to the Value Area Low (dotted blue) at $0.0000193. At the time of writing, this level served as a local support. However, the price action outlined a bearish market structure.
The Directional Movement Index agreed with both the -DI (red) and the ADX (yellow) above 20 to signal a strong downtrend in progress. In fact, the A/D indicator has been making lower highs over the past two weeks – A sign of buyers’ weakness.
Source: Coinglass
Finally, the 3-month liquidation heatmap revealed that there were two magnetic zones of interest near BONK’s market price. The closest one was at $0.0000185. Its density and proximity meant it was the short-term price target.
After a sweep of this liquidity pocket, a bullish reversal towards $0.0000235 would become likely.
Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion
