Key Takeaways
Toncoin surged in the first half of 2024, reaching a new all-time high price of $8.28 in June. However, momentum fizzled shortly afterward and TON went through a 36% correction, diverging from the rest of the market’s end-of-year rally.
While the TON foundation’s plans to announce their focus on expansion in the U.S. are newsworthy, the TON price still risks a breakdown from a critical horizontal support area, something that would confirm a bearish trend reversal is underway.
On January 14, the TON Foundation announced the hiring of Manuel Stotz as President. Stotz will succeed Steve Yun and focus on the expansion in the U.S. market under the seemingly pro-crypto administration of Donald Trump.
Previously, Stotz served on the Foundation’s board and is the co-founder of a London-based investment firm that has backed over 50 blockchain sector leaders.
The same day, Toncoin also published an article regarding their key milestones since 2018, highlighting the split from Telegram and the ensuing rebrand, improvement of the ecosystem, and integration with Tether in 2024.
The TON price has fallen since reaching an all-time high of $8.29 in June 2024. While the price regained its footing and bounced in November, the rally was short-lived. TON created a lower high in December (black circle) and returned to the $5.30 horizontal support area, where the price trades today.
The $5.30 area is critical since it has existed for nearly a year. Additionally, there is no horizontal support under it until $2.30, so the price could collapse if it confirms the breakdown.
Furthermore, the area coincides with an ascending support trend line existing for 540 days, reiterating its importance.
So, a breakdown below $5.30 can trigger a 50% price decline to $2.30.
Technical indicators are leaning bearish. The Relative Strength Index (RSI) has fallen under 50, while the Moving Average Convergence (MACD) just decreased below 50. The latter has also made a bearish cross (black circle).
So, the weekly time frame leans bearish. A close below $2.30 will confirm the correction, possibly catalyzing a 50% decline.
A closer look at the movement reveals a bearish head-and-shoulders pattern that has been developing since April 2024. The 5.30 area marks the pattern’s neckline, so a decline below it can trigger a sharp plunge.
A Toncoin price decline that travels the entire pattern’s height would take the price toward the previously outlined support at $2.70, a decrease of nearly 50% from the current price.
On the other hand, this bearish TON prediction will be invalidated with a close above the resistance trend line.
If that happens, Toncoin’s price could increase toward its all-time high and possibly move to $10.56, a target created by the 1.61 external Fibonacci retracement resistance level.
This is less likely to happen because of the bearish readings and pattern.
Even though the TON Foundation announced positive news on Jan. 14, it did not affect the price positively.
On the contrary, TON risks losing the critical $5.30 support area. Doing so will confirm a bearish head and shoulders pattern and could trigger a 50% price decline.