Toncoin nears a dreaded pattern despite strong on-chain metrics

The Toncoin token remained in the bear market and was at risk of forming the dreaded death cross pattern despite strong on-chain metrics.

Toncoin (TON) traded at $5.81 on Monday, September 30, down over 30% from its year-to-date high.

Powerful on-chain metrics

Additional data showed that the number of wallets activated on-chain increased significantly from January’s low of 1.1 million to over 20.8 million.

Moreover, the number of Toncoins burned daily continued to increase, reaching the highest level since the beginning of the year with almost 39,000. These burns coincided with a sharp decline in the number of Toncoins minted; that number fell to 39,000 from this month’s high of 50,000.

TON Blockchain fees increased | Source: TonStat’s role in DeFi is decreasing

Toncoin’s price has likely declined due to its diminished role in the decentralized finance industry, where the total value locked on the network fell to $427 million from $765 million in July.

TON has become the 20th largest chain among the top ten players in the DeFi industry. Smaller chains such as Core, Mode, Mantle and Linea have surpassed this in recent weeks.

Toncoin also fell due to the recent arrest of Pavel Durov in France and the performance of win-win tokens. Hamster Kombat, which launched its airdrop last week, is down almost 60% from its peak.

Similarly, Notcoin (NOT) is down 71%, while Catizen (CATI) is down 50% from its all-time highs. Many of the recently launched Telegram’s win-win tokens have fallen to record lows.

Meanwhile, Toncoin futures open interest fell from a year-to-date high of $360 million to $260 million on September 30. This figure reached its lowest point since September 12, indicating reduced demand.

Toncoin price analysis Toncoin price chart | Source: TradingView

Toncoin’s token is down over 30% from its year-to-date high, and the 50-day and 200-day Exponential Moving Averages are close to forming a death cross pattern. The last time he created this pattern, in May of last year, it resulted in a decline of over 50%.

TON also modeled a rounded top with a head and shoulders. It remains below the initial support level of Andrew’s pitchfork tool and the 23.6% Fibonacci Retracement level.

Therefore, unless Toncoin breaks above the 50-day and 200-day moving averages, it may trend downward towards the next key support at $4.45, the September low.