- BONK has formed a double-bottom pattern on a higher timeframe chart suggesting a bullish trend reversal.
- However, a lack of high trading volumes in the derivatives market could lead to price consolidation.
Bonk [BONK], the second-largest meme coin on the Solana [SOL] blockchain, dropped by 4% in 24 hours to trade at $0.0000448 at press time. Trading volumes were also down by 40%, per CoinMarketCap, mirroring the downtrend across the broader market.
Despite this recent drop, BONK has been among the top-performing tokens in 2024. In fact, it has gained by more than 200% year-to-date.
With 2024 drawing to a close, BONK is already showing signs of recording more gains in the coming weeks.
BONK forms a double-bottom pattern
BONK has formed a double-bottom pattern on its one-day chart, which usually signals a reversal from a downtrend to an uptrend.
The meme coin hit the peak of this double-bottom pattern on November 20 when the price soared to an all-time high of $0.0000623. After dropping to form its first bottom, BONK formed a neckline at $0.000046, and it is once again testing resistance at this level.
If BONK flips this resistance level, which is also the neckline for the double bottom pattern, it could ignite a rally past $0.0000623, paving the way for a new ATH.
On the other hand, if it fails to breach this resistance and drops below the support level at $0.000040, it will invalidate the bullish thesis and ignite a downtrend.
Source: Tradingview
Technical indicators on this chart suggest that an uptrend is highly likely. The Money Flow Index (MFI) has been tipping north, showing high buying pressure and rising capital inflow into BONK.
Moreover, the MFI has a reading of 67 showing that the momentum remains bullish, and BONK has yet to become overbought.
The BBTrend indicator confirms that bulls are in control. However, the fading histogram bars suggest that momentum could be weakening.
Derivative trading volumes could precede consolidation
Trading volumes around BONK in the derivatives market have subsided significantly in the last two weeks as shown by Coinglass data. These volumes hit record highs in mid-November as BONK rallied to an ATH.
Source: Coinglass
At the same time, BONK’s open interest has dropped from $64M to $26M in three weeks, further highlighting a lack of high market participation.
If there is no fresh uptick in speculative activity, BONK could be stuck in range-bound consolidation.
Read Bonk [BONK] Price Prediction 2024-2025
Can BONK flip WIF in 2025?
As AMBCrypto reported, BONK briefly surpassed dogwifhat (WIF) in November to become the largest Solana meme coin. WIF has since retaken its top position with a $3.68 billion market cap against BONK’s $3.34 billion.
If BONK rallies past resistance at $0.000046 and confirms the double-bottom pattern, it could lead to a continued uptrend in 2025, that will consequently support market cap growth. A fresh ATH for BONK could see it dethrone WIF once again.
