BONK Price Sees 8% Surge Amid Market Recovery

BONK Price Sees 8% Surge Amid Market Recovery

On Tuesday, BONK’s price experienced an 8% increase, marking a brief relief rally after a recent market downturn. This surge in buying momentum came in the wake of Bitcoin maintaining its position above $50,000, as the overall cryptocurrency market climbed 8.7% to reach $1.95 trillion. Despite this uptick, many major altcoins remain significantly off their lows, as bearish market sentiment and fears of a recession continue to weigh on traders.

BONK Price Hovers at Critical Support

Over the past three weeks, BONK has encountered significant selling pressure, as evidenced by a series of red candles on the daily chart. This bearish trend has driven the asset down from $0.000035 to a low of $0.000015 as of Monday, representing a 54% decline.

Reflecting recent price corrections, BONK has seen a sharp drop in open interest (OI) since late July. Data from Coinglass shows that OI has plummeted from $13 million to $5.7 million, a decrease of 55%. This decline suggests a reduction in market liquidity and waning investor interest in BONK.

Today’s market rebound saw BONK recover to $0.0000196, as the coin attempts to maintain its position above the support trendline of a channel pattern. On the daily chart, the Solana-based meme coin has been following a steady recovery trend since February 2024, characterized by two parallel trendlines.

However, derivative market data reveals a negative OI-Weighted Funding Rate of -0.028, indicating that short sellers are paying to hold their positions, reflecting their expectation of further price declines.

Additionally, the Average Directional Index (ADX) has risen to 19%, suggesting that sellers are increasingly dominant in the current market environment.

Should BONK break below the support trendline, it could further intensify the selling pressure, potentially leading to a 28% drop, testing the $0.000012 support level.

Conversely, if BONK manages to sustain above the lower trendline, buyers might form a reversal pattern that could negate the bearish outlook. Such a rebound could see the asset rise by more than 30%, targeting $0.0000266.