Toncoin (TON) is showing early signs of a bullish reversal. On Friday, the price surged to $3.27 after breaking out of a descending triangle pattern. This breakout ends weeks of horizontal range-bound action and is an initial signal of shifting market sentiment for the altcoin.
The recent price action returned both the 20-day EMA at $3.00 and the 50-day EMA at $3.15, as per TradingView. Toncoin is now testing toward the 100-day EMA at $3.59, acting as dynamic resistance. The technical formation is positive for the current upsurge, and daily charts are also seeing more bullish signs.
Toncoin’s price rally is underpinned by a double-bottom formation at around $2.80. There is also an alignment of higher lows, reinforcing bullish strength further. These are tell-tale signs that accumulation is occurring, and buying pressure is being initiated on strategic support areas, pushing the price higher.
Breakout level signals bullish potential rise
A major shift in structure occurred near the breakout level in early July. This ended TON’s multi-month downtrend. Technical analysts believe that should TON manages to remain above the $3.15 to $3.27 area, it could push into never-before-tested areas of supply.
Currently, the token is against overhead resistance represented by the downtrending line of the triangle. Completion of an upside break could negate the bearish formation that capped the price for weeks. It could take the token to $3.40 or even the $3.50 region.
Still, the breakout is not confirmed. Sellers might strongly back the resistance. If the price does not break above and reverses back, bears might take over. Pelin Ay predicts that Toncoin could reach a maximum price of $10.35 this season but does not expect it to go higher.
Toncoin eyes breakout, targets $3.50
A breakdown of resistance could trigger a pullback below the 20-day EMA. It could take TON down back into the $2.90 area. Below $2.75 could also be bearish, showing that the latest positive trend is reversing.
On the four-hourly, the upward sloping moving averages support the bulls’ case for further gains. The RSI also stays in positive territory, showing that momentum favors buyers, for now. Traders watch closely for a breakout above trendline resistance.
If bulls manage to take out that level, Toncoin can rise quickly. The next targets lie around $3.40 and $3.50. Otherwise, failure to hold support could trigger a deeper correction and stall the current rally.
