Here’s Why Toncoin Could Go Up 30%

• Toncoin price is retesting the key support area between $4.83 and $5.19, which, if not broken, could be followed by a bullish move.
• Supply distribution data shows that a cohort of whales bought TON during the recent price decline.
• A daily candle close below $4.83 would invalidate the bullish thesis.

Toncoin (TON) price is retesting a crucial support zone on Monday, trading broadly flat around $5.20 in the early European session. Recent moves by high-wallet investors suggest that if Toncoin is able to hold above this key technical level, a rally for the Telegram-linked token could be on the horizon.

Toncoin shows potential for a rally

Toncoin price is retesting a key support area between $5.18 and $4.83. This area roughly coincides with three major support levels:

1. The uptrend line, drawn by consolidating several lows from late February.
2. 61.8% Fibonacci retracement level at $5.21, pulled from a March 17 low of $3.32 to a June 15 high of $8.28.
3. The lower band of the volume profile (the total volume traded at a certain price level in a certain period in increasing volume) at $5.25.

All of the above levels form a key reversal zone. On Monday, TON traded broadly stable, hovering around $5.20. If the $4.83 level holds, the price of Toncoin could rise by 30% to retest the daily resistance level at $6.23.

The Relative Strength Index (RSI) and the Awesome Oscillator (AO) on the daily chart have dipped below their neutral levels of 50 and zero, respectively, suggesting momentum remains weak. If the bulls do come back, then both momentum indicators need to break above their respective neutral levels. Such a development would add a tailwind to the recovery rally.

TON/USDT daily chart

Santiment’s supply distribution figure shows that the number of whales holding between 100,000 and 1 million TON tokens has dropped from 4.01 million on August 26 to 3.2 million today. Meanwhile, wallets holding 1 million to 10 million TON grew from 0 to 1.11 million during the same period.

This development shows that the first cohort of whales may have fallen prey to the surrender event. Instead, the second set of wallets took the opportunity to stock Toncoin at a discount during the recent price drop, which was triggered by the arrest of Telegram founder Pavel Durov in France.

Toncoin supply distribution metric chart

Even though on-chain metrics and technical analysis support the bullish view, if Toncoin makes a daily candlestick close below $4.83, the bullish thesis would be invalidated by creating a lower low on the daily chart. This development could see Toncoin price drop another 11% to retest the next daily support at $4.27.