Despite robust on-chain metrics, the Toncoin token continues to grapple with a bear market and faces the risk of forming the feared death cross pattern.
As of Monday, September 30, Toncoin (TON) was valued at $5.81, down more than 30% from its highest point this year.
Robust on-chain metrics
Recent statistics indicated that the count of on-chain activated wallets has surged to over 20.8 million, a notable rise from the low of 1.1 million recorded in January.
Additionally, the daily burn rate of Toncoins has consistently increased, reaching a year-to-date peak of nearly 39,000. This surge in burns has corresponded with a significant decrease in the minting of Toncoins, which has plummeted to 39,000 from this month’s high of over 50,000.
DeFi significance declines
The decline in Toncoin’s price can likely be attributed to its diminishing importance within the decentralized finance sector, where the total value locked in the network has fallen from over $765 million in July to $427 million.
TON has slipped from being one of the top ten players in the DeFi landscape to now ranking 20th among chains. In recent weeks, smaller chains like Core, Mode, Mantle, and Linea have surpassed it.
Furthermore, Toncoin’s value has also suffered following Pavel Durov’s recent arrest in France and issues faced by its tap-to-earn tokens. Hamster Kombat, which initiated its airdrop last week, has experienced a nearly 60% decline from its peak.
Notably, Notcoin (NOT) has plummeted by 71%, while Catizen (CATI) has seen a 50% drop from their all-time highs. The majority of the recently launched tap-to-earn tokens from Telegram have reached all-time lows.
In addition, Toncoin’s futures open interest fell to $260 million on September 30, down from a year-to-date high exceeding $360 million. This figure marks the lowest level since September 12, indicating reduced demand.
Toncoin price evaluation
Toncoin has fallen by over 30% from its year-to-date peak, with the 50-day and 200-day Exponential Moving Averages nearing a potential death cross formation. When this pattern last appeared in May of the previous year, it triggered a decline exceeding 50%.
Additionally, TON has developed a head and shoulders pattern along with a rounded top formation. It currently sits below the initial support level of the Andrew’s pitchfork tool and the 23.6% Fibonacci Retracement level.
Consequently, Toncoin may face a bearish breakout toward the next crucial support level at $4.45, its lowest point in September, unless it makes a move above the 50-day and 200-day moving averages.
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