- BONK’s Open Interest rates and capital inflows in the futures market surged to record levels
- Although the surge is bullish for BONK’s price, BTC losses could affect further upswing.
Bonk [BONK], a Solana [SOL] homegrown meme coin, was up 20% on the weekly price charts. It was trading at $0.00004095, about 17% from its record all-time high of $0.00004770 on the 4th of March.
A move above the ATH will effectively push BONK into price discovery, i.e., into new price territory never hit before.
In such a scenario, a crypto trader, Ninja Scalp, projected that BONK could explode based on a similar phase in early March.
“$BONK – last time the dog coin entered price discovery in March, a spike in volume occurred on the Solana blockchain shortly after, with ~$2b volume daily. Will history repeat itself?”
It’s worth noting that historical data doesn’t dictate future outcomes.
However, BONK saw massive buying on-chain volume and overwhelming positive market sentiment, as shown by the Volume (marked white) and Weighted Sentiment (marked red).
This underscored BONK’s bullish set-up.
Source: Santiment
Interestingly, Ninja Scalp’s assertion on Open Interest (OI) surge during price discovery was playing out as of press time. For the unfamiliar, OI tracks capital inflows and overall sentiment in the futures market.
At press time, BONK’s OI hit a record of $24 million, compared to the $20 million hit in early March’s price discovery.
The surge in OI suggested that BONK saw massive capital inflows recently, a bullish sentiment in the futures market.
Source: Coinglass
However, liquidity maps showed considerable liquidation levels concentrated on the lower side of price action, specifically around $0.000035 and $0.000040 (levels marked by orange).
Source: Coinglass
Typically, price action tends to move towards high liquidity levels (orange). If such a scenario plays out, the BONK price could ease to $0.000040 or $0.000035 before moving forward to $0.000045.
On the price charts, the above liquidity clusters aligned with 23.6% and 38.6% Fib levels.
Source: BONK/USDT, TradingView
So, BONK could see more gains if bulls defend the 23.6% Fib level, with immediate targets at the previous ATH (0.000048) and $0.000056.
However, despite the incredible buying pressure, as shown by the bullish RSI (Relative Strength Index) reading, the CMF hasn’t broken above the average level.
The last time BONK hit the price discovery level, CMF (Chaikin Money Flow) was above zero. So, the capital inflow has so far been great, but CMF was below the March reading.
Realistic or not, here’s BONK’s market cap in SOL terms
In fact, BONK’s further upside could be delayed if Bitcoin [BTC] fails to hold above the $67K level.
As Ninja Scalp stated, there’s been a considerable jump in OI as BONK nears another price discovery. However, the bullish momentum could be weakened if BTC records more losses.
