🌎 Toncoin Faces Bear Market and Death Cross Despite Strong Metrics

The Toncoin token has remained in a bear market and faces the risk of forming the dreaded death cross pattern, despite strong on-chain metrics.

Toncoin Market Performance

Toncoin was trading at $5.81 on Monday, September 30, marking a decline of over 30% from its year-to-date high.

Strong On-Chain Metrics

Data indicates that the number of on-chain activated wallets has surged to over 20.8 million, a significant increase from January’s low of 1.1 million. Additionally, the daily number of Toncoins burned has risen, reaching a year-to-date high of almost 39,000. This increase in burns has coincided with a sharp decline in the number of minted Toncoins, which has dropped to 39,000 from this month’s high of over 50,000.

TON Blockchain fees have also risen considerably, reflecting these changes.

Decline in DeFi Role

Toncoin’s price drop can be attributed to its diminishing role in the decentralized finance (DeFi) industry. The total value locked (TVL) in the network has fallen from over $765 million in July to $427 million. As a result, TON has moved from being a top-ten player in the DeFi space to the 20th-largest chain, surpassed by smaller chains such as Core, Mode, Mantle, and Linea.

Additionally, Toncoin has been affected by Pavel Durov’s recent arrest in France and the performance of its tap-to-earn tokens. For instance, Hamster Kombat, which launched its airdrop last week, has dropped by almost 60% from its highest level. Similarly, Notcoin has decreased by 71%, and Catizen has fallen by 50% from their all-time highs. Most of the recently launched Telegram’s tap-to-earn tokens have plummeted to record lows.

Meanwhile, Toncoin’s futures open interest dropped to $260 million on September 30, down from the year-to-date high of over $360 million. This figure has reached its lowest point since September 12, indicating waning demand.

Toncoin Price Analysis

Toncoin’s token has fallen by over 30% from its year-to-date high. The 50-day and 200-day Exponential Moving Averages (EMAs) are close to forming a death cross pattern. The last time this pattern formed, in May of last year, it resulted in a drop of over 50%.

TON has also formed a head and shoulders and a rounded top pattern. It remains below the first support level of the Andrew’s pitchfork tool and the 23.6% Fibonacci Retracement level. Therefore, Toncoin may experience a bearish breakout to the next key support at $4.45, its lowest point in September, unless it moves above the 50-day and 200-day moving averages.