- The trendline support has been important in May.
- A short-term range formation could aid buyers looking to re-enter the BONK market.
Bonk [BONK] saw a rejection at the $0.0000249 resistance level, the same level that rebuffed its bulls on the 14th of May. On the 1-day chart, BONK had a bullish structure. For close to a month, BONK has defended a rising trendline support.
However, it failed to break above the $0.0000249 resistance, which previously formed a lower high during the late-January downtrend
Source: BONK/USDT on TradingView
The Trading Volume has been relatively high over the past three weeks. This saw the OBV trend higher in May, after a rocky start to the month.
The new highs the OBV set reflected increased buying pressure on the token.
Over the past week, the RSI of BONK has corrected from strong bullish momentum to neutral/weakly bullish momentum, based on how close it has been to the neutral 50 level.
Taken together, the price action and indicators suggested that more bullishness was warranted. A retest of the trendline support could offer a buying opportunity.
Where should BONK traders scoop up the dip?
Source: BONK/USDT on TradingView
The 4-hour chart showed a range formation over the past ten days. This range (purple) extended from $0.000018 to $0.000024. The mid-range level was at $0.000021, and it served as support a few days ago.
The RSI on the 4-hour chart showed bearish momentum. The OBV did not fall too deep, and the trading volume has been below average during the memecoin’s price dip. This suggests that the buyers will regain strength and push higher in the coming days.
The selling pressure in the past two days came alongside the Bitcoin [BTC] reset from the $111k mark. It bumped BONK beneath the $0.000021 support, and headed toward the trendline resistance or the local low (the range low) at $0.000018.
Hence, a retest of these levels should offer a buying opportunity.
Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion
