Toshi (TOSHI), the mascot memecoin of the Base blockchain, has recently captured attention with its volatile price movements. Following a significant rally, the token experienced a pullback, prompting a closer look at its technical indicators and potential future trajectory amidst a generally subdued memecoin market.
Recent Volatility and Market Structure
Toshi recently saw a sharp 34% rally from August 3rd to 6th, which was quickly followed by a 5.61% price drop within 24 hours. Despite this recent surge, TOSHI has struggled to establish a strong bullish trend over the past two months, mirroring the broader memecoin sector with few exceptions. On the lower timeframes, specifically the 1-hour chart, Toshi's market structure remains technically bullish after breaching the $0.00065 mark. A retracement to the 61.8% Fibonacci level at $0.000518 preceded its latest gains, with the Directional Movement Index (DMI) supporting the ongoing uptrend.
Indicators Signal Bullish Weakness
While the market structure appears bullish, key indicators reveal underlying weakness in buying pressure. The Accumulation/Distribution (A/D) indicator has shown a downtrend since June, signaling reduced buying interest, which could hinder a sustained rally. Similarly, the Money Flow Index (MFI) also points to a lack of robust buying momentum. Currently, Toshi is forming a descending triangle pattern on the 1-hour chart, retesting the $0.0006-$0.00062 zone, which previously acted as resistance, now as a crucial support level.
Future Outlook and Critical Levels
Despite the noted weakness, a bullish breakout from the descending triangle pattern is anticipated. Liquidation heatmaps reveal a significant cluster of liquidity just above $0.006, suggesting this area could act as a magnet for price action. A potential scenario involves the price sweeping this liquidity zone before targeting $0.007. However, the sustainability of any upward movement hinges critically on a significant increase in buying pressure to counter the current bearish signals from the A/D and MFI. Traders are advised to exercise caution given the potential for short-term volatility.
