ONDO Finance (ONDO) saw a brief surge of almost 20% yesterday, only to see those gains reversed within 24 hours. Despite this setback, ONDO continues to hold a leading position in the real-world asset (RWA) sector.
Recent technical indicators are hinting at a slowdown in momentum, with a decrease in whale activity observed for the first time in over two weeks. The future trajectory of ONDO, whether it can recover and surpass key resistance levels or continue its correction towards lower support zones, will be influenced by market sentiment and any upcoming developments related to its potential inclusion in the reserve.
The Relative Strength Index (RSI) for ONDO has experienced a downturn after reaching its highest levels in 3 months. Yesterday's momentum surge drove the RSI to 76.1 before easing back to 54.8.
The RSI measures the speed and magnitude of price movements on a scale of 0 to 100, with levels above 70 signaling overbought conditions and levels below 30 indicating oversold conditions. Crossing the 70 mark for the first time in three months, traders interpreted ONDO's RSI as a signal of robust bullish momentum before the recent pullback.
Currently standing at 54.8, ONDO's RSI has retreated to neutral territory, suggesting a reduction in buying pressure. This indicates that the recent rally may have been stretched too far, potentially leading to profit-taking and a period of consolidation.
Keeping an RSI above 50 would enable ONDO to sustain its bullish structure and make another upward move. Conversely, a decline towards 40 or lower may indicate waning momentum, raising the likelihood of further downside movements.
The number of ONDO whales (wallets holding between 1 million and 10 million ONDO) had been on a steady rise but recently saw a reversal. After reaching 221 by March 1, the whale count has dropped to 214. Monitoring whale activity is crucial as large holders can significantly impact price fluctuations through their buying and selling decisions.
While the recent decline in whale numbers could imply profit-taking or reallocation among large holders, the overall confidence in ONDO remains high compared to previous months. A sustained drop in whale numbers could result in increased selling pressure and subsequent corrections, while a resurgence in whale accumulation could signal a potential price recovery.
ONDO's price briefly approached $1.20 during the recent market rally before starting a corrective phase. Moving forward, whether ONDO can maintain its position in the RWA sector and withstand short-term price fluctuations is contingent on the depth and stability of the ongoing correction.
If the correction persists, ONDO could be tested near the $0.95 support level, possibly extending down to $0.90 or $0.88. Breaking below $0.80 would mark a significant trend shift since November 2024. Conversely, renewed bullish sentiment could propel ONDO upwards, especially in scenarios where the US adopts a more crypto-friendly stance on RWAs or includes ONDO in its strategic crypto reserve.
In such instances, ONDO could surpass resistance levels at $1.26 and $1.44, with a strong upward momentum potentially propelling it towards $1.66.