- Toncoin has risen to its highest level in more than a year.
- The price has risen to overbought; so there is a downside on the horizon.
During a significant increase in the past month, Tonmint [TON]the cryptocurrency linked to popular messaging app Telegram, has risen to its highest value since February 2022, according to data. CoinMarketCap.
At the time of writing, the altcoin was exchanging hands at $2.68, up nearly 50% in the past month. Although the altcoin’s value has grown steadily over the past month, most of the gains came in the past two days.
The cause of this can be attributed to Pavel Durov, the founder of Telegram, who on November 7 announced the giveaway of 10,000 premium subscriptions for its messaging app.
Durov specified in his announcement that he purchased the premium accounts using TON tokens, for a total amount of approximately $200,000.
As a result, TON’s price rose 8.4% during the intraday trading session on November 8, briefly overtaking leading meme coin Dogecoin. [DOGE] in terms of market capitalization.
As expected, Durov’s announcement led to a sharp increase in demand for TON. Data obtained from Santiment showed that the daily number of unique addresses involved in TON transactions has increased by 46% since November 6.
Likewise, the number of new addresses created to trade TON daily has increased by more than 70% over the same period.
This showed that apart from the growth in demand for TON from pre-existing addresses, there has been a higher volume of new demand for the altcoin in recent days, hence the price increase.
Source: Santiment
A TON round imminent?
A review of TON’s price movements on a daily chart showed that increased trading activity over the past two days pushed the token’s key momentum indicators to overbought heights.
At the time of writing, the Relative Strength Index (RSI) and Money Flow Index (MFI) stood at 80.11 and 87.75 respectively.
An RSI value above 70 and an MFI value above 80 are often considered overbought levels. This indicates that the asset’s price may have risen too quickly and that a reversal or correction is imminent.
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Also, the gap between the upper and lower bands of TON’s Bollinger Bands indicator widened after Durov’s announcement.
Typically, a widening gap between the upper and lower ranges indicates that price movements are experiencing significant volatility. Traders often interpret this as a sign that the market is becoming increasingly unpredictable. There is also a chance of large price fluctuations.
Source: TON/USDT on TradingView
