Toncoin has experienced extreme pressure
The Toncoin community is facing severe turmoil following the detention of Telegram's creator, Pavel Durov. Reports indicate Durov's arrest in France might lead to a sentence of up to 20 years in prison. This development has significantly affected the cryptocurrency associated with Telegram.
Per Coinglass statistics, there's been an unprecedented surge in Toncoin sell-offs, reaching an all-time high. An astonishing $7.21 million in Ton positions were liquidated, a figure that eclipses the liquidations recorded during this month’s earlier market downturn.
During the August 5th market dip, liquidations in Ton peaked at $6.5 million, predominantly affecting those betting on price increases. The recent sell-offs, however, impact both those betting on prices to rise and those expecting them to fall.
This heightened level of liquidation is indicative of the market’s current state of high volatility and frequent price fluctuations. Generally, such market conditions trigger stop-loss orders and margin calls, causing involuntary liquidations.
Following the legal troubles of Telegram's head, Toncoin’s market capitalization plummeted from $17.1 billion to $14.2 billion, losing $2.9 billion in value. This drop is accompanied by a 27.3% decrease in trade volume.
The surge in liquidations has steered Toncoin’s value onto a downward slope. On the weekly charts, Toncoin’s value has plummeted by 18.77%.
This downturn is further proven by the plummeting Relative Strength Index (RSI), which dropped from 52 to 36 at the time of this report.
A decreasing RSI indicates that Toncoin is under tremendous sell-off pressure, pushing it towards an oversold state. This situation highlights the growing uncertainty and diminishing investor confidence in the cryptocurrency’s future.
Similarly, the Directional Movement Index (DMI) has decreased from 23 to 16, signifying that the selling momentum has forced the cryptocurrency into a bearish trend.
A crossover of the positive index below the negative one accentuates the strength of Toncoin's bearish movement within the past day.
Moreover, a spike in exchange inflows suggests that Ton holders are bracing for further price drops, prompting them to transfer their assets for potential sale. The unfavorable news has thus moved investors to liquidate their assets on exchanges.
Consequently, as the data highlights, this adverse news has tainted market perception, leading to heightened selling pressure and, as a result, a downturn in market cap, trading volume, and asset values.
Hence, with the prevailing market attitude, the cryptocurrency faces the risk of a further drop to a support level of $4.77.
