The price of Toncoin (TON) has surged to its highest point in 11 months following the launch of Telegram's 'Giveaways' feature.
The price of TON faces the potential for a short-term correction as it approaches a convergence of historically robust resistance areas.
Toncoin (TON) has achieved its highest price levels in nearly a year, driven by several positive developments in its market, notably the recent introduction of the "Giveaways" feature on Telegram.
TON is now ranked as the 10th largest cryptocurrency, boasting a market capitalization exceeding $9 billion, a record high for the digital asset.
On November 6, Telegram unveiled the Giveaways feature, allowing channel owners to randomly distribute prizes to their followers. In a noteworthy move, Pavel Durov, Telegram's CEO, used $200,000 worth of TON tokens to cover Telegram Premium subscriptions for 10,000 Telegram users just one day later.
Pavel Durov's announcement of Toncoin giveaways. Source: Du Rove’s Channel
Notably, Durov employed TON as the payment method within the Giveaways feature, at least in this specific instance.
Since the launch of Giveaways, TON's price has surged by 19.5%, accompanied by an increase in trading volumes, signifying robust buying interest. As of November 8, the cryptocurrency had reached $2.71, its highest level in 11 months.
TON/USDT daily price chart. Source: TradingView
Telegram is a prominent supporter of Toncoin, having integrated a self-custodial wallet into its platform. This move has bolstered TON's potential for broader adoption among Telegram's 700 million monthly active users.
Additionally, Toncoin's recent partnership with Blockchain.com and its approval in the Dubai International Financial Centre free trade zone have served as bullish indicators for traders, as evident in the upward price movements shown in the chart below.
TON/USD daily price chart. Source: TradingView
From a technical perspective, the Toncoin price chart indicates that it may be overvalued.
Specifically, TON's daily relative strength index (RSI) has climbed above 70, entering overbought territory. Past instances of the RSI entering overbought regions have led to significant price corrections.
TONUSDT daily price chart. Source: TradingView
Furthermore, TON faces a formidable multi-month horizontal resistance range at $2.60 to $2.70. This range has repeatedly capped TON's attempts at upward movement since December 2022, heightening the potential for a bearish reversal in the coming days or weeks.
In the event that this bearish scenario unfolds, the key support level to watch is near $2.22, in line with the Q1/2023 support line, representing a 17.5% decline from current price levels. This level is in proximity to Toncoin's multi-month ascending trendline and its 50-day exponential moving average (50-day EMA).
Conversely, a decisive breach of the $2.60 to $2.70 resistance range would position TON to target $2.92 as its next upside objective.