Coinbase recently added the popular meme coin, BONK, to its roadmap. BONK, initially distributed through a Solana community airdrop in December 2022, has garnered attention within the crypto community, and now Coinbase's decision caused more attention to shift towards BONK, causing a 17% price increase immediately after the announcement. BONK has also been able to rise to the third-largest memecoin by market capitalization, surpassing the very popular PEPE. However, despite its very impressive growth over the past few months, respected market analyst Ali Martinez suggested that BONK may be approaching a potential reversal in the near future.
Coinbase Adds BONK to Its Roadmap
Coinbase , one of the leading cryptocurrency exchanges in the United States, announced yesterday that it has decided to include the popular meme coin, BONK, in its roadmap. BONK initially distributed a very large portion of its total supply through an airdrop to the Solana community. Since its launch in December of 2022, BONK has captured the attention of the crypto world, even contributing to a surge in the price of the SOL token as trading continued towards the end of the same year.
However, the market response to Coinbase's decision has been nothing short of a roller coaster ride for BONK's price, with impressive growth followed by sudden fluctuations. BONK experienced a meteoric rise in value, with its price surging by a staggering 2,969% since the beginning of November this year. This amazing growth continued into the first ten days of December.
One of BONK’s latest successes came with Coinbase's announcement. The exchange's decision to include BONK in its future plans sent shockwaves through the meme community. In fact, the news triggered an immediate surge in BONK's price, boosting the meme coin's value with a 17% price increase.
BONK's airdrop to the Solana community played a significant role in its initial success. By distributing a big portion of its supply to Solana users, BONK effectively gained a very loyal user base within the Solana ecosystem. As Solana gained popularity in the crypto world, so did BONK, contributing to the positive sentiment around the token in recent times.
BONK Flips PEPE
In an impressive turn of events, BONK has risen to become the third-largest memecoin by market capitalization, surpassing fellow meme coin PEPE on Dec. 8. This meant that BONK was only trailing behind Dogecoin (DOGE) and Shiba Inu (SHIB), which boast market caps of around $5 billion and $13 billion, respectively.
One of the primary catalysts for BONK's remarkable ascent was its listing on major centralized exchanges, notably Binance and KuCoin. As BONK found its way onto these exchanges, it immediately attracted a surge of interest from both seasoned crypto enthusiasts and newcomers to the space.
Further driving BONK's gains is the data from the futures market, which reveals a big uptick in open interest over the past month. This surge in open interest indicates that traders are actively participating in the BONK derivatives market. As more traders engage with BONK futures contracts, it creates more trading opportunities and liquidity, which in turn contributes to the token's overall price volatility.
What is Next For BONK’s Price?
BONK now finds itself at a critical juncture, with its impressive bullish growth showing signs of potentially pausing or even reversing. Respected market analyst Ali Martinez expressed this sentiment in a recent X post, and highlighted a noteworthy shift in a key BONK indicator.
This indicator previously signaled a buy during BONK’s massive 8,000+% bull run but is now flashing a sell signal. In other words, Martinez, known for favoring the TD Sequential indicator to spot trend-exhaustion patterns, suggested that BONK’s month-long surge may start to face headwinds very soon. While the analyst has not pinpointed the exact timing of this reversal, he suggested it might happen within the next one to two weeks.
Daily chart for BONK/USDT (Source: TradingView)
Looking at the meme coin’s daily chart, BONK seems to have entered into a consolidation phase between $0.0000061975 and $0.0000164450 over the past few days. It was, however, rising towards the upper level of this range. Should it break above the key barrier, it could continue its impressive streak in the following couple of days.
On the other hand, a rejection from the $0.0000164450 resistance level in the next 48 hours may lead to a correction down to $0.0000061975 in the short term. Thereafter, continued sell pressure could force BONK below this mark to the subsequent support level at $0.0000032020.
Technical indicators on the meme coin’s chart suggested that buyer strength has decreased substantially in the last few days. At press time, both the Moving Average Convergence Divergence (MACD) and the Relative Strength Index (RSI) were flagging bearish.
The negative slope of the MACD Histogram may be an early sign of an upcoming bearish trend reversal. Meanwhile, the RSI line was positioned below the RSI Simple Moving Average (SMA) line. This is a sign that bears have an upper hand against bulls. Subsequently, it will be easier for sellers to drag BONK’s price down than it will be for buyers to boost it in the next few days.
In contrast, despite the launch of Shibarium, SHIB has only managed to achieve a 15.59% year-to-date (YTD) growth, trailing far behind BONK's staggering 11,265.85% YTD gain. It is, however, important to keep in mind that BONK is still in its early stages. Despite BONK's impressive price performance, it still lags behind its meme competitors in terms of fundamental ecosystem utility, like with the relationship between Shibarium and SHIB.