Whales buying up Toncoin despite price risks
Recently, increased activity by significant investors on the Toncoin network has been detected, as per a recent study by CryptoQuant's Joao Wedson.
Wedson's analysis highlighted a rise in the number of wallets possessing from 100,000 to 1 million TON tokens.
Wedson pointed out that this pattern of accumulation by key stakeholders typically reflects a bullish stance on the asset's future, suggesting confidence in TON's ongoing expansion and robustness.
Despite this bullish signal from heavy investors, the price of TON hasn't shown significant movement, indicating a potential dip might be imminent.
Challenging Times Await TON
Currently, the digital currency is trading at $6.43. Despite a noteworthy 20% appreciation in the past month, a correction might be approaching for TON.
Although the price of TON has seen an upward trajectory, its Relative Strength Index (RSI) and Money Flow Index (MFI) suggest a decrease, indicating a bearish divergence. Currently, the RSI stands at 52.57, with the MFI at 23.39.
These indicators suggest that, despite the recent price rally, the momentum behind buying TON is possibly fading.
The presence of a bearish divergence hints to traders that the current uptrend could be running out of steam, with a potential decline looming.
Supporting this bearish outlook, the Parabolic SAR indicator's dots for TON are positioned above its current price.
This indicator serves to predict the future direction of an asset's price and signifies reversals when its dots align above the price, indicating a bearish phase with weakened buying pressure, potentially leading to a price drop.
Moreover, the current positioning of TON's Moving Average Convergence Divergence (MACD) line beneath its signal line further accentuates the bearish sentiment.
This configuration is often interpreted negatively, suggesting that the asset's upward momentum is dwindling and that the rate of increase in its short-term moving average is decelerating more rapidly than that of the longer-term moving average.
This is commonly seen as an indicator for traders to shift their strategies, considering exiting shorter positions in anticipation of taking longer ones.
