Bonk failed to break through the major resistance trend line, which would have seen the meme coin survive further declines. However, given the falling wedge that BONK is stuck in, it requires another pullback.
This sentiment is also shared by investors who place short bets on the meme coin.
The bank financing rate decreases again
At the time of writing, Bonk price is above an important support line of $0.00002153. This level has been tested several times in the past, but this time, the meme coin may fall below it.
The big reason behind this possibility is the downward trend observed among BONK holders. These investors took a step back, and at the same time, traders started placing short bets in the futures market. This is evidenced by the financing rate, which decreased to -0.0215%.
A financing rate is a periodic fee exchanged between long and short traders in perpetual futures to keep the contract price in line with the spot market. Negative rates indicate that put contracts dominate the market, while positive rates indicate a much greater presence of call contracts.
In the case of BONK, it is the former that may influence the market.
The broader market signals aren’t particularly bullish either; Otherwise, investors would have faced the downside. For example, the Relative Strength Index (RSI) is currently below the 50.0 neutral line.
The Relative Strength Index is a momentum oscillator that measures the speed and variability of price movements. It indicates overbought or oversold conditions in the asset. It appears that BONK is not in the overbought zone yet, which means a recovery.
Read more: Bonk Airdrop Eligibility: Who Can Claim and How?
BONK Price Prediction: Decline
BONK price moving inside a falling wedge will eventually indicate a breakout to the upside. However, before that happens, another withdrawal is the next step.
In fact, BONK could see a 57% drop to test the wedge’s lower trend line, slipping below the $0.00001000 support in the process.
Read More: 11 Best Solana Meme Coins to Watch in 2024
However, this ensures that BONK price falls through the support lines at $0.00002153 and $0.00001392. A bounce from either of the two could invalidate the bearish thesis and enable Bonk to begin the recovery.
Disclaimer
In line with Trust Project guidelines, this price analysis article is intended for informational purposes only and should not be considered financial or investment advice. BeInCrypto is committed to providing accurate and unbiased reporting, but market conditions are subject to change without notice. Always do your own research and consult a professional before making any financial decisions. Please note that our Terms and Conditions, Privacy Policy and Disclaimer have been updated.