Toncoin saw strong bullish momentum, closing at higher highs for four consecutive days and reaching a high of $2.9.
TON has been recovering mainly due to major upgrades and the recent change in leadership, with Telegram taking over from the Ton Foundation as validator, as AMBCrypto reported earlier.
With Toncoin (TON) rising to a record high, the futures market has seen increased speculation, largely driven by whales.
Futures volume reached overheating for the first time on May 8. Volume at such levels suggests that too many traders have taken leveraged positions.
Thus, futures trading activity became excessively high, signaling increased speculation and market crowding.
Toncoin whale takes $5.3M bet amid growing leverage
Amid this surge in activity, some whales are betting aggressively for more winnings. According to Lookonchain, a whale opened a 3x long position on 1.97 million tonnes, worth $5.39 million.
As the market experiences increased upside volatility, this whale’s position is already up $23.3k.
Besides this whale, the market has seen significant demand for futures positions. In fact, Toncoin’s Long Short ratio increased to 1.46, with 59% of the total in long positions.
When long positions dominate the market, it suggests that most traders are optimistic and expect prices to rise even further.
As expected, the liquidation rate of long and short positions skyrocketed. According to CoinGlass, the total liquidation reached $28.7 million on May 8.
In total, $13.1 million in long positions were liquidated, while $15.6 million in short positions were liquidated. Increased liquidations indicate market price volatility.
Can TON Reverse $3 Resistance?
Although Toncoin has rallied from $2.90, the altcoin’s bullish momentum remains intact, largely driven by strong market demand.
In fact, the relative strength index (RSI) of altcoins surged to 93, reaching overbought conditions. The RSI reaching such levels suggests that buyers have taken full control of the market.
Although overbought zones have often preceded pullbacks, an asset can remain in an overbought zone for an extended period of time. At the same time, the BvB normalized EMA reached an extreme level, reaching 80, confirming the strength of this trend.
Taken together, these two indicators signal the likelihood of further gains on the price charts. So, if the momentum continues, Toncoin bulls will look to move above $3.
However, TON is currently facing extreme leverage with speculators dominating the market. Often, increased speculation follows a fall in prices, particularly caused by a cascade of liquidations.
If speculation collapses, the market will likely fall again, with $2 providing critical support.
Final Summary
- A Toncoin whale opened a 3x long on 1.97 million TON, worth $5.39 million.
- TON’s bullish momentum remains intact, but extreme leverage risks further decline.
