Toncoin (TON) has been exhibiting strong bullish price action recently, with technical analysis and on-chain data suggesting the possibility of a significant rally. Despite some uncertainty in the broader cryptocurrency market, TON has managed to show resilience, gaining attention from traders and investors alike. As of now, TON’s price is nearing $3.35, and key indicators point toward a potential breakout that could see the token surge by as much as 15%.

Current Price Action and Technical Analysis

At the time of writing, Toncoin is trading at $3.35, reflecting a 3.5% increase in the past 24 hours. Although this shows a recovery from recent price drops, it is important to note that the trading volume has dipped by 14%, which indicates caution among traders. Despite the reduced volume, the technical outlook remains promising.

AMBCrypto’s technical analysis highlights that TON has formed an ascending triangle pattern on the hourly chart. This pattern is considered a bullish signal, typically indicating that the price is preparing for a breakout to the upside. If TON can break above the $3.37 resistance level, it has the potential to surge by 7%, reaching $3.60. Furthermore, if the momentum continues and TON closes a daily candle above $3.40, the token could see a rally of up to 15%.

Key Resistance Levels

The price action over the past few days shows that TON has been testing key resistance levels. A break above $3.37 would be crucial for confirming the bullish trend. A close above $3.40 would further solidify the upward momentum, potentially paving the way for a rally toward $3.80 and beyond. These levels are significant as they indicate areas where the price could face resistance, but breaking them would open the door for further upside.

On-Chain Data and Market Sentiment

In addition to the technical analysis, on-chain data supports the bullish outlook for Toncoin. According to Coinglass, the sentiment among traders is largely positive, with many betting on long positions. At press time, traders holding long positions at $3.184 are over-leveraged, holding a combined total of $1.50 million worth of long contracts. This indicates that traders are positioning themselves for upward price movement.

On the other hand, $3.40 has emerged as another critical level where short positions are dominant. Traders have accumulated $900K worth of short positions at this level, which could create a short squeeze if the price breaks through. A short squeeze could propel the price even higher, adding to the bullish momentum.

Moreover, there has been a significant outflow of Toncoin from exchanges, with $2.34 million worth of tokens leaving the platforms during the same period. This suggests that long-term holders and investors are accumulating TON, likely in anticipation of further price increases. The reduction in exchange supply could contribute to upward pressure on the price if demand continues to rise.

Potential Challenges and Risks

Despite the bullish signals, it is important to consider the risks. Toncoin’s Average Directional Index (ADX) is at 18, indicating that the current trend strength is weak. This could suggest that the market is uncertain, and while bullish price action is occurring, the momentum may not be as strong as it appears. Traders should keep an eye on the ADX and other market indicators to assess whether the trend will gain strength or reverse.

Conclusion

Overall, Toncoin appears to be poised for a potential rally, with key technical indicators and positive on-chain data supporting the bullish sentiment. If TON can break above resistance levels at $3.37 and $3.40, it could see a surge of 7% to 15%. Additionally, the strong support from long-term holders and the outflow of TON from exchanges indicates confidence in the token’s future performance. However, as with any cryptocurrency, it is crucial for traders and investors to stay cautious and monitor key levels to gauge the strength of the rally.