Over the weekend, Monad [MON] rallied by 13.92% from the $0.0245 Saturday low to the $0.0279 Sunday high. The Layer 1 blockchain token was helped in its bullish progress by a Bitcoin [BTC] bounce toward the $84k supply zone.
This bounce helped altcoins across the market climb higher, although short-term sentiment has not fully turned bullish once again.
The short-term gains were likely driven by capital flows into the altcoin sector, boosted by the seeming turnaround in Bitcoin momentum. Since Friday, the 9th of October, the altcoin market cap has bounced by 2.88% to reach $1.13 trillion.
Monad’s short-term gains do not mask longer-term concerns
Despite the short-term Monad gains, the altcoin has struggled to surpass a key long-term supply zone. Earlier in October, popular crypto influencers and traders on the X platform had called it “an easy token to short”.
Entrepreneur and former asset manager Harley Lewis Foote predicted that the November “mega unlock” could send the token into a downward price spiral. Since the 5th of October, MON is down 21.3%, rejected from the $0.033 supply zone.
What’s next for Monad crypto?
The $0.016 and $0.0375 were the pivotal long-term levels to keep an eye on. They dictate the structure, and a break of either would signal where the trend can go next.
The gains made since July indicated that, for now, the expectations remained cautiously bullish, even though the $0.033 supply zone rejected MON bulls recently.
There was a sizeable imbalance (white) overhead that could pose a substantial threat to the buyers. The mid-point of this FVG was at $0.0297.
This level coincided well with the cluster of short liquidations around $0.030 that the 1-month lookback period liquidation heatmap underlined.
Therefore, in the coming days, a price move to this area to squeeze short positions out could commence.
It remains to be seen if there is substantial demand in spot and perpetuals markets to keep the Monad uptrend going. A breakdown below $0.0209 would be a sign of a bearish internal structure shift on the daily timeframe.
In the coming days, a bounce toward $0.030-$0.033 and the subsequent reaction would dictate which way swing traders need to place their Monad bias.
Final Summary
- Monad rallied 3.4% in the past 24 hours alongside a positive price reaction from Bitcoin and some altcoins on Sunday.
- The Monad momentum has been upward since July, but the failure to overcome the $0.0345 supply zone earlier this month hinted at buyer weakness.