Toncoin: Understanding the Pressure from Profit-Taking on TON's Rally

Toncoin: How profit-taking pressure can cap TON's rally

Toncoin (TON) has experienced resistance around the $1.70 mark recently. Although there was initial bullish momentum in the cryptocurrency market driven by Bitcoin's surge beyond $90,000, Toncoin has since lost some of that momentum. Recent analysis indicates that while there is potential for Toncoin to break out and rally, profit-taking may hinder further price increases.

Key Takeaways

Toncoin faces resistance at $1.70, where profit-taking may limit price gains.
The overall market trend for Toncoin has been bearish, with critical support and resistance levels identified.
Traders are advised to capitalize on short-term bullish movements while being mindful of profit-taking strategies.

Analysis of Toncoin's Price Resistance

Toncoin 1-week Chart
Source: TON/USDT on TradingView

Over the past month, Toncoin has struggled to break through the resistance level of $1.70. The bullish momentum that many altcoins, including Bitcoin, experienced in early January has not translated into significant growth for Toncoin, which has seen a slight decline of 1.29% over the past week.

A recent report from AMBCrypto emphasized the importance of the $1.70 resistance level. Successfully breaking past this mark could trigger a short-term rally. However, on-chain metrics have shown an increase in the 90-day Market Value to Realized Value (MVRV) ratio, suggesting that existing holders might engage in profit-taking, which could cap any price gains.

Additionally, while Open Interest in Toncoin has risen, the average coin age has remained unchanged, indicating a lack of market-wide accumulation and diminished confidence among investors.

Price Charts Insights for TON Holders

Toncoin 1-week Chart
Source: TON/USDT on TradingView

The weekly price trend for Toncoin continues to reflect a bearish sentiment, as indicated by the Directional Movement Index (DMI) and current price actions. For bulls, a significant price point to watch is $3.75, which is over double the current trading price of Toncoin. Surpassing this resistance level would suggest the possibility of a long-term bullish trend.

Interestingly, the On-Balance Volume (OBV) has not reached new lows in the past two months, which is a modest silver lining for investors. The weekly chart has also highlighted crucial supply zones at the $2.3-$2.4 and $2.8 price levels.

Traders’ Perspective: Long Positions and Profit-Taking

Toncoin 1-day Chart
Source: TON/USDT on TradingView

For short-term traders, there’s an opportunity to benefit from the recent bullish momentum. The OBV and daily trading volume have shown signs of increased buying activity since late December.

The previous resistance at $1.70 has flipped to act as support, offering a potential entry point for swing traders looking to buy Toncoin. However, caution is advised; traders should set profit targets at levels of $2.16 and $2.37, and they should monitor closely for any dips below $1.56, which would invalidate bullish positions.

Conclusion

Disclaimer: The information provided in this article is for informational purposes only and does not constitute financial, investment, trading, or other types of advice. It reflects the author's opinions.