TON Faces Continued Selling Pressure Amid Bearish Key Metrics - Is Its Bullish Momentum Over?

Volatility and bearish bias has been witnessed in the crypto market in recent weeks, and one crypto asset that has been caught in the middle of this is Toncoin (TON). Originally motivated by an increase in whale activity and key developments within the ecosystem TON saw a notable uptrend, flying from $1.87 on Jan 3rd to an all-time high of $7.67 on April 11th, marking a 310% gain.

As of writing time , TON is currently trading at $6.41, a 1.15% decrease in the last 24 hours but a 4.17% gain in the last 7 days. Its trading volume has however dropped by 24% in the last 24 hours to read at  $131 million currently while its market cap stands at $15.4 billion

However, since reaching its all-time high on 11th April, TON has struggled to maintain its upward momentum. Despite a number of attempts to create a new fresh all-time high, the crypto asset has encountered resistance at the $7.4 zone. Since May 13th, when TON last tested this resistance level for the second time, the price has shown bearish movements, filling a fair value gap left on May 9th.

The outlook for TON still appears bearish from the technical indicators data on Tradingview with the daily RSI currently reading at 52, almost fully neutral reading away from the overbought region seen several days ago. This shift in momentum suggests a bearish sentiment prevailing in the market currently.

Also, the Moving Average Convergence Divergence (MACD) indicator also points to potential bearish continuation. The MACD line is slightly below the signal line, more bearish momentum conflict.

If the downtrend continues, TON price could further drop to retest the ascending trendline below the fair value gap it filled recently . In the event of a more substantial decline, the price may even revisit the building double top neckline support at the $4.59 level.

Examining the on-chain indicators in more detail reveals that a number of them—possibly more to come—are adding to the negative outlook for TON. Since April 11th, there has been an increase in the supply of TON on exchanges, per Santiment statistics. This increasing supply on exchanges indicates that more holders are transferring their coins, potentially to sell, leading to strengthened selling pressure.

Also, the Daily active addresses metric has been declining over time since May 11th. This reduction in the number of unique addresses engaging in transactions on the blockchain could mean lower network participation and  usage reflecting a decline in interest of this crypto asset.

Looking further still on these bearish signals the Long short ratio on Coinglass also reveals a falling trend since May 24th, with a higher number of traders holding or initiating short positions. This surge in short positions suggests that market participants anticipate further price declines, adding to the possible extended selling pressure on the asset.

As TON navigates through these rough bearish times, whether Ton will continue its bullish momentum and hit $10 or anticipate for further declines will be determined by whether bulls can maintain price above the ascending trendline or above the double top neckline.