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Highlights
- Meme coins bleed deeply as Bitcoin plunges below $55,000.
- The sell-off in the market was triggered by news of Mt. Gox starting payments to creditors.
- The German government is on the record for sending Bitcoin into exchanges, further fueling the sell-off.
Unlike other cryptocurrencies, the Solana meme coin, Bonk price is up on Friday, defying widespread headwinds. The pump comes amid a Bitcoin price crash below $55,000 triggered by selling pressure emanating from key events such as the defunct Mt. Gox exchange starting payments to its creditors and the German government’s BTC selling spree.
Although Bonk and other meme coins were not spared by the correction that has suppressed prices since the end of May, it remains unfazed by the current pressure on the sell side.
Here’s Why Bonk Price Is Surging
From a technical standpoint, BONK sits on top of a solid support area provided by a long-term ascending trend line and the 200-day Exponential Moving Average (EMA) in purple.
Traders also jumped on the opportunity to buy BONK at the $0.00002 support area and are betting on the price rebounding to reach $0.000025 by the weekend and $0.00004 in the coming week.
A vivid Relative Strength Index (RSI) bearish divergence stresses the importance of understanding the technical outlook of assets. Since BONK set out on the pullback from March peak at $0.000045, the RSI formed a negative divergence with the price.
Investors who may have been following this indicator could have sold near the peak and waited to buy when the RSI is near or in the oversold region below 30.
Currently, the RSI holds in the neutral region and above 45. The 5% rebound can be attributed to to the recovery from near oversold conditions. A break above the descending RSI trend line could spur growth in Bonk price as traders rush to buy the meme coin before breaking out.
Nevertheless, the death cross pattern established recently when the 20-day EMA flipped under the 50-day EMA calls for caution among traders and investors.
It may not be wise to go all-in on Bonk at the moment. Traders should DCA responsibly until the token recovers above the 20-day EMA and the 50-day EMA.
What’s Next As BONK Rebounds To $0.000022
After bulls viciously defended $0.00002 support, Bonk bounced above $0.000022. However, this uptick could be in jeopardy due to the resistance highlighted on the four-hour chart by the 20-day EMA in blue.
Conversely, an upcoming buy signal from the Moving Average Convergence Divergence (MACD) indicator could validate the bullish thesis. Traders can watch out for this call likely to materialize as the blue MACD line crosses above the red signal line. The first target for daily traders would be $0.000025 but long-term investors might anticipate a larger breakout toward $0.00004 in July.
Frequently Asked Questions (FAQs)
1. What’s the origin of Bonk?
2. Is Bonk competitive?
3. Where can I trade Bonk?
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