Bonk Faces 27% Drop as Bearish Pressure Rise: Will It Happen?

Technical patterns suggest that Bonk could see a sharp decline as it finds rebound levels.

As traders push prices higher, longer liquidations on the market are [surge]d.

Bonk’s winning streak over the past month has been on the decline, as the asset has fallen by 10.45% over the past seven days. This decline has continued over the past 24 hours, with prices dropping by another 2.03%.

According to Ambcrypto’s examination, prices could be pushed higher as market participants look for the best price to re-enter.

Technical Path to a Decline in Trajectory

On the chart, Bonk is trading within a descending channel, which is characterized by lower highs and lower lows, with price trends moving within support and resistance zones.

Bonk recently reacted to the pattern resistance line and continued to decline, a move that could extend further downwards to support levels, potentially resulting in a 27.20% loss.

The motivation for this fall is that investors could push prices lower in search of discount levels where they can accumulate assets.

This could push prices up to support levels, and strong momentum could eventually push them higher.

Will the fall happen?

There is a high chance that Bonk will fall further as the market sentiment in the derivatives market is strongly bearish.

A key indicator is the liquidation data which shows how much long and short traders lost in a given period.

Currently, $438,000 is liquidated for longs while only $6,400 is liquidated for shorts. This means that for every $1 long contract, only $0.0146 worth of short contracts were closed.

The major gap shows that the market is heavily biased in favor of shorts, which suggests that prices will continue to fall.

The OI-weighted funding rate, which aggregates funding rate and open interest data from multiple exchanges, shows that a large selling wave is still in play.

At the time of writing, the indicator has entered the negative zone with a reading of -0.0152. This area is associated with falling prices, making it likely that Bonk will see a significant drop.

More bearish signals surface

The bearish trend in the market remains strong as two technical indicators – Parabolic Core SAR (Stop and Reverse) and Bulls and Bears Strength – confirm the presence of sellers.

The Parabolic SAR uses dots to determine potential market direction, indicating downward pressure when dots appear above price. This suggests that the Bunker could be headed for further declines.

Similarly, the strength of bulls and bears indicates that buyers and sellers are leading the market trade, confirming that sellers (bears) are in control.

Red momentum continues to build and moves lower. For now, bears are turning the corner on the market, and if this sentiment persists, the Bunker could trend lower.