The value of Solana-based meme coin Bonk (BONK) has seen a significant drop in value over the past week. As of the latest update, BONK is trading at $0.000021, marking a 24% decrease in the last seven days.
This decline has brought BONK to key support levels that have been forming a descending triangle pattern since May. Recent readings on important technical indicators suggest the possibility of further downward movement.
BONK Facing Challenges in Holding Support
Examining BONK’s 1-day chart reveals a descending channel that the altcoin has been following since May 29. Currently, BONK has dropped by 42% from its recent highs.
A descending channel is characterized by a series of lower highs and horizontal support lines, indicating a bearish trend continuation if the price breaks below the support line. At present, BONK is hovering near the $0.000021 support level.
Several key technical indicators on the daily chart of BONK indicate the potential for a breakdown below the support level and continuation of the downtrend.
For example, the relative strength index (RSI) for BONK is currently at 36.35, indicating a downward trend. The RSI assesses overbought and oversold conditions in the market.
The RSI scale ranges from 0 to 100, with readings above 70 signaling overbought conditions and readings below 30 indicating oversold conditions. With BONK’s RSI at 36.35, substantial selling pressure is evident in the meme coin market.
Forecasting BONK’s Price: Are New Lows Ahead?
The configuration of BONK’s Moving Average Convergence/Divergence (MACD) indicator further supports the bearish outlook for the meme token. Currently, the MACD line is below the signal line and the zero line.
When the MACD line falls below the signal line, it signals weakening price momentum and the likelihood of continued decline. A break below the zero line confirms a strong downtrend, prompting traders to consider exiting long positions and entering short positions.
If the support level fails to hold, BONK could potentially drop to $0.000012, marking a multi-month low. However, a shift in market sentiment, accompanied by a surge in trading volume, could propel BONK’s price to $0.000025.
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