Toncoin (TON) has been a big winner in the crypto industry this year, climbing up the ladder to become the eighth-biggest coin. It has soared by over 246% this year and 455% in the past 12 months, beating the performances of other top altcoins like Cardano and Ether.
Toncoin’s encouraging metrics
Toncoin’s foundation is robust. Telegram, its ‘parent company,’ has transformed into a leading social media firm with nearly a billion users. Likewise, the TON Blockchain has surged to become the 10th largest chain globally, surpassing platforms such as Optimism, Sui, Cronos, and Mantle.
At the same time, Toncoin has reaped the benefits of the ongoing tap-to-earn expansion, which has attracted millions of users worldwide to platforms like Hamster Kombat, TapSwap, and Notcoin.
Toncoin has also demonstrated strong on-chain metrics. According to Tonstats data, the network’s fee collection has reached its highest level since May, and the daily transaction volume has surpassed 5.77 million.
Additionally, on-chain metrics such as the number of on-chain wallet activations and monthly active wallets have seen an increase in recent days.
Despite these figures, Toncoin’s price is susceptible to three technical risks that could potentially lead to a bearish reversal in the upcoming weeks.
Rising wedge, low volume, and bearish divergence
First, as shown above, the TON price has formed a rising wedge chart pattern, which is indicated in green above. This pattern is formed when an asset’s price moves upwards in a narrowing range. It is characterized by two converging trendlines and decreasing volume.
In most cases, a rising wedge leads to a bearish breakout when the two lines near their convergence, which is about to happen. If the pattern works well, the TON price could drop to the psychological point of $5.
Second, the Toncoin price has also formed a bearish divergence pattern, as shown in the abovementioned MACD and Relative Strength Index (RSI) indicators. While TON has been on a steady rise, the two indicators have constantly made a downward trend. Like the wedge pattern, a bearish divergence leads to a bearish breakout over time.
Toncoin daily volume
Finally, TON’s daily traded volume has been a bit weak compared to its market cap. As shown above, the daily volume has been less than an average of $300 million in the past few weeks. While this is still a huge sum, it is smaller than smaller tokens like Pepe and Dogwifhat. Lower volume means that the recent rally had limited breadth.
Altogether, these risks mean that the TON price is at risk of more downside unless it sees a strong catalyst in the coming weeks.
