Toncoin (TON) has been experiencing some fascinating technical developments lately, most notably a significant drop in its volatility. With Bollinger Bands squeezing tightly on its 12-hour chart, this reduced fluctuation could signal an impending price move — but will it be in a positive direction? The key question now is whether Toncoin can break out of its current slump and reclaim the $4.5 price level, or if its bearish trend will persist.

Squeezing Bollinger Bands: A Sign of a Price Breakout?

The recent squeezing of Toncoin’s Bollinger Bands suggests that volatility has decreased sharply, a pattern that often precedes a major price movement. The tightening of the bands indicates that the market is in a period of low volatility, but as history shows, such periods can lead to sharp price expansions in either direction. This could suggest that Toncoin is due for a significant move soon, but the real challenge lies in predicting which way that move will go.

However, while the technicals show promise, there are several underlying factors in Toncoin’s market that make the future direction more uncertain.

A Bearish Chart Structure Weighing on Toncoin

Despite the technical squeeze on its Bollinger Bands, Toncoin’s overall market structure remains bearish. The daily chart shows a persistent downtrend, with sellers dominating the price action. This is further evidenced by the supply distribution chart, which reveals that large addresses or whales have been selling off their holdings steadily in recent months.

Toncoin’s distribution data also reveals that addresses with small holdings (100 TON or fewer) have been on the rise since October. This shift suggests that the smaller retail investors are increasing their exposure, but at the same time, larger investors are exiting the market, which has been a key factor putting downward pressure on the price. Whale selling, coupled with a reduction in liquidity from bigger players, is not conducive to an immediate recovery in price.

Flattening Network Metrics and Subdued Activity

Adding to the bearish outlook is the lack of significant network activity. Toncoin’s network growth — a key metric for the number of new addresses being created — has remained stagnant since October. Even during the brief rally in November, which saw TON’s price rise above $7.5, the network failed to generate substantial new user participation.

Moreover, the number of active addresses has steadily decreased, reflecting a decline in the number of users actively engaging with the Toncoin network. This drop in user activity is a warning sign for investors, as it indicates that Toncoin has failed to generate much excitement among its community. Without an influx of new users or investors, the chances of a robust price recovery remain slim.

Whale Behavior: A Key Indicator of Future Movement

The actions of whales play a crucial role in determining Toncoin’s price trajectory. Over the past few weeks, whale activity has been marked by consistent selling. As a result, the overall market sentiment has remained largely negative. This selling pressure could continue to suppress Toncoin’s price, as whales control a significant portion of the supply.

At the same time, smaller addresses have been slowly increasing their holdings, but they haven’t yet been able to offset the large-scale sell-offs by whales. The balance between these two groups will likely determine the near-term price direction.

Can Toncoin Reclaim $4.5?

As of now, the path to Toncoin reclaiming the $4.5 level seems uncertain. The combination of sustained whale selling, low network growth, and reduced volatility all point to a more cautious market. While the Bollinger Bands squeeze could imply that a price move is coming, whether that move will be an upward breakout or further downward consolidation remains to be seen.

For Toncoin to rise above the $4.5 mark, several things would need to happen. First, the network would need to see a resurgence in activity, with more new users joining and more trades occurring. Second, whale selling would need to subside, as large holders exiting the market have been a key barrier to upward price movement. Lastly, broader market conditions would also play a role — if the overall sentiment in the cryptocurrency market turns more positive, it could provide Toncoin with the catalyst it needs to move higher.

Conclusion: Eyes on Toncoin’s Next Move

Toncoin’s reduced volatility, along with a squeezed Bollinger Bands setup, indicates that a significant price move could be coming. But with the current bearish chart structure, whale selling, and sluggish network activity, it’s unclear whether this will lead to an upward movement or if Toncoin will face further price declines. Investors should tread carefully, keeping an eye on any changes in whale behavior and network growth, as these factors will likely dictate the direction of the next price move.