Toncoin faces potential decline as weak hands emerge among holders
Toncoin (CRYPTO:TON) recently saw its price briefly rise above $7 on August 14, offering a glimmer of hope to investors after a lackluster performance in the first quarter of 2024.
However, this rally was short-lived, as the price has since dropped to $6.76.
The token now appears vulnerable to further declines, with several indicators suggesting that more downward pressure could be on the horizon.
One of the key metrics signaling this potential downturn is the Mean Dollar Invested Age (MDIA) of Toncoin holders.
The MDIA measures the average time that investors have held their TON assets.
Typically, a rising MDIA indicates that holders are committed to holding their tokens for the long term, often leading to price stability or growth.
However, the current trend shows a declining MDIA, suggesting that some investors are beginning to sell off their holdings, reducing the overall holding time.
This decrease in holding time is further corroborated by the Coins Holding Time metric from IntoTheBlock, which shows that the average duration that holders have refrained from selling their TON has dropped by 95% in the past week.
This sharp decline indicates that many holders are now choosing to sell, potentially due to a lack of confidence in the token’s short-term prospects.
Given these developments, Toncoin’s price could face further pressure, particularly if the selling trend continues.
Historically, the $6.75 price level has been a supply zone that has triggered approximately 10% declines in the past.
For instance, in May and again between late July and early August, TON experienced significant price drops after trading around this level.
If the current selling pressure persists and demand does not pick up, Toncoin could see its price fall to around $6.19, marking another potential 10% decrease.
This scenario underscores the challenges TON faces in sustaining its recent gains and highlights the importance of stronger investor conviction to support future price stability.
At the time of writing, Toncoin was priced at $6.49.
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
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