Toncoin (TON) has taken a steep dive in the past 24 hours, with prices plummeting as panic selling surged after French authorities shockingly arrested Telegram CEO Pavel Durov.
TON’s price declined by as much as 25% to reach $5.24 on Aug. 25, a day after the news of Durov’s detention went viral. Durov faces charges related to data privacy and cryptocurrency regulation violations.
TON/USDT daily price chart. Source: TradingView
Telegram has been instrumental in promoting and integrating Toncoin within its ecosystem, making Durov a central figure in the coin’s narrative and future development. As a result, some Toncoin traders have sold their holdings in panic.
However, several technical and market factors suggest that TON may be primed for a substantial rebound in the coming weeks.
TON will likely mirror BNB’s sharp rebound
TON’s ongoing price decline appears similar to how BNB (BNB) performed in the days before former Binance CEO Changpeng Zhao’s sentencing.
BNB fell by 13.50% ahead of Binance CEO Changpeng Zhao's (CZ) sentencing in the United States on April 30. However, once the legal dust settled, the cryptocurrency staged a strong recovery, surging by nearly 35% from its lows to reach almost $700 on June 6.
BNB/USD daily price chart. Source: TradingView
When news of legal troubles breaks, especially involving key figures like CZ and Durov, it triggers a wave of panic selling as traders rush to protect their investments from potential fallout.
However, once the initial shock subsides, the market reassesses the situation more rationally.
In BNB’s case, after the dust settled around CZ’s sentencing, traders realized that the legal issues, while significant, did not pose an existential threat to Binance, the company, or its ecosystem.
This led to a psychological shift from fear to optimism, as traders who had sold out of panic began to re-enter the market, driving BNB’s price up by 35%.
The same psychological pattern could play out for Toncoin. Initially, Durov’s arrest might be seen as a major red flag, leading to sharp declines as traders exit their positions.
But if the market later perceives the arrest as an isolated incident that doesn’t fundamentally undermine the Toncoin ecosystem, traders could start to view the dip as an opportunity to buy the panic.
TON bounces from ascending channel support
From a technical perspective, TON trades within a well-defined ascending channel range, as seen in the daily chart.
The TON/USDT pair bounced from this channel's lower trendline, which has acted as strong support since its formation earlier this year.
TON/USDT daily price chart. Source: TradingView
Additionally, TON’s daily relative strength index (RSI) reading was 37.54 on Aug. 25, nearing its oversold threshold of 30, typically leading to consolidation or rebound.
The upper trendline of the ascending channel currently hovers near $8.50. Moving toward this level would represent a roughly 50% gain, aligning with the bullish momentum suggested by the RSI.
Rising OI and funding rates signal market confidence
The futures market data for Toncoin also indicates growing confidence among traders. After Durov’s arrest, TON’s open interest (OI) rose to $303.62 million, its highest since July. Meanwhile, its funding rates for every eight hours rose to a three-month high of 0.0101%.
TON OI and funding rates. Source: Coinglass
Rising OI suggests that more money flows into TON’s futures market, signaling increased interest and speculation on the price direction. The positive funding rates indicate that traders are increasingly willing to pay a premium to hold long positions in TON.
Moreover, the increased funding rates indicate that traders are betting on a price increase, further fueling the potential for a sharp upward move. If this momentum continues, it could lead to a rapid price appreciation, potentially driving TON toward the $8.50 target and beyond.
This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.
