Toncoin (TON), a cryptocurrency closely linked with the messaging platform Telegram, has been under considerable selling pressure following the arrest of Telegram's CEO, Pavel Durov. Despite the downturn, some investors are taking advantage of the lower prices to increase their holdings.
A recent analysis by a crypto expert has revealed a bearish head and shoulders pattern in TON's price chart, which suggests the potential for further declines. Yet, many TON holders remain optimistic, continuing to "buy the dip" and accumulate more tokens despite the market challenges.
For Toncoin bulls, it is critical to defend the current support level to prevent additional price drops. In a recent post on X, a well-known crypto analyst and trader, AlienOvichO, provided technical insights that point to the formation of a head and shoulders pattern on TON’s daily chart.
Toncoin Price Outlook
The head and shoulders pattern is a well-known signal of a possible trend reversal, featuring three peaks: a shoulder, a head, and another shoulder, with the neckline serving as a key support level. According to AlienOvichO, if TON breaks below this neckline—currently providing support around $4.78—the price could continue to decline.
While establishing a clear upward trend might be challenging, the analyst emphasized that TON buyers need to maintain a sideways price movement to avoid a bearish outcome.
"TON bulls need to act to prevent this bearish structure from taking shape," AlienOvichO stated, "and the best strategy might be maintaining a sideways trend for a few weeks before making a strong upward move."
Interestingly, some large investors, known as whales, have viewed the recent price drop as a buying opportunity. Data from Santiment shows that these major holders have been accumulating more TON since Durov's arrest. Currently, whales holding between 1 million and 10 million TON tokens control 9.07% of the total circulating supply.
However, this accumulation by whales contrasts with the behavior of smaller holders, particularly those with between 10,000 and 1 million TON, who have been reducing their positions. This shift indicates that while larger investors are capitalizing on the dip, smaller investors may be losing confidence due to the uncertainties surrounding Toncoin.
TON Price Forecast: Potential Dip to $3.76
Technical indicators for TON seem to support the bearish sentiment expressed by AlienOvichO. The Chaikin Money Flow (CMF), which measures the flow of capital in and out of an asset, is currently negative at -0.10, indicating increased selling pressure.
Additionally, the Parabolic Stop and Reverse (SAR) indicator, which helps identify the direction of an asset's trend, is showing dots above TON's current price. When these dots appear above the price, it suggests a downtrend, and there is potential for further price declines.
If TON falls below the crucial $4.78 support level, the next target could be $4.73. Failure to hold this level might see TON's price drop to $3.76, which was its lowest point back in March.
On the other hand, if market conditions shift from bearish to bullish, and the ongoing whale accumulation sparks a broader demand for TON, the price could rally to $5.49.
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