- Solana-based BONK memecoin has come under intense bearish pressure since peaking at $0.000041 on May 28.
- As the coin trades within a descending channel, the Bonk coin faces a 36% drop if it breaks below key support.
Bonk coin (BONK) was one of the best performers and highlighted tokens during the recent memecoin mania that saw such coins lead the bull market and reach all-time highs. Leading up to its all-time high of $0.000041 reached on May 28, the little-known cryptocurrency was one of the best-performing altcoins. Solana’s SOL and its ecosystem-driven projects were largely dictating investor sentiments and guiding the bull market.
At the time, BONK was outperforming the more popular, established, reputable, and diverse rivals such as Shiba Inu (SHIB), and Dogecoin (DOGE).
However, its performance has been subdued. Its case is not isolated, with memecoins losing their appeal with investor appetite falling. Partly, this is due to renewed interest in Bitcoin, illustrated by inflows into Bitcoin spot ETFs. Additionally, the possibility of an Ether spot ETF launching soon has drawn investor attention to large-cap cryptocurrencies including Ethereum. But it is important to note that Solana is a leading candidate to have its ETF confirmed by the SEC but Ethereum, its rival, is leading the race.
At the time of writing, BONK is trading for $0.00002501 following a 2.6% surge in the last 24 hours. The altcoin has staged a rebound that sees it climb back above key support. On the weekly chart, BONK has lost 12%, painting a midterm bearish outlook.
With a $1.6 billion market cap, the 65th-ranked coin, Bonk is in a bearish phase, currently trading below its 20-day Exponential Moving Average (EMA). This indicates that recent prices are lower than the average price over the past 20 days.
The continued weakness below the critical EMA suggests persistent selling pressure. This selling could attract new sellers looking to capitalize on the downtrend or cause existing holders to lose confidence and sell their positions.
While its volatility offers investors quick profits, it equally exposes investors to great risk. Furthermore, its memecoin status means that it has no inherent value, suggesting that it will struggle to attract long-term investors. These types of investors offer price stability and long-term prospects. With speculators and retail traders in the driving seat, this points to a rocky price movement.
Coinbase has recently introduced perpetual futures contracts for popular meme coins Shiba Inu, Floki, and Bonk, which will increase trading activity for these meme coins.
