The meme coin market has been facing a tough time in recent months, with Bonk [BONK] experiencing a significant downtrend. According to data from the crypto data platform Artemis, meme coins have been among the worst performers in the past month. The sector has seen a 41% drop in fully diluted market capitalization, with an average performance of -30.2%. This is in stark contrast to Bitcoin [BTC], which has experienced a -19.2% performance.
The downtrend in the meme sector has not spared Bonk, which has been struggling to maintain key support levels. After a period of rapid gains in November, the bulls have been unable to sustain the momentum, leading to a fall below the November lows in early February. As of now, Bonk is down by another 23% and has revisited the April 2024 support level. The price is expected to continue its downward trajectory, with a possible 15% bounce before further losses.
The short-term holder net unrealized profit/loss (STH NUPL) for Bonk has also painted a bleak picture, with short-term holders facing significant losses. The NUPL value currently stands at -1.22, reaching as low as -1.35 on February 24th. This extreme low in NUPL indicates that the downtrend may not be over yet, as historical data suggests that a bounce in price does not always follow such lows.
Despite the challenging market conditions, there is a glimmer of hope for Bonk and other meme coins. In the past, rallies in coins like Dogecoin [DOGE] have led to significant gains in meme coins like Bonk. Therefore, a potential rally in DOGE could trigger a recovery in the meme coin market, including Bonk. However, until there is a clear change in market conditions, traders should be prepared for the bears to maintain control.
In conclusion, the meme coin market, including Bonk, has been facing a tough period with a significant downtrend. While there are indications of a potential bounce in price, traders should remain cautious and expect further losses in the near term. A potential rally in coins like DOGE could trigger a recovery in the meme coin market, but until then, the bears are likely to remain dominant.