The star of the 2023 bull market and the Solana ecosystem, Bonk, is surprising investors with disruptive price behavior. After losing over 65% of its value last month, BONK has shown signs of a bullish resurgence, leaving market participants curious and cautious about the reasons behind this unexpected growth.
The star of the 2023 bull market and the Solana ecosystem, Bonk, is surprising investors with disruptive price behavior. After losing over 65% of its value last month, BONK has shown signs of a bullish resurgence, leaving market participants curious and cautious about the reasons behind this unexpected growth.
A plausible explanation for the BONK price recovery is the strategic action taken by whale investors. These investors are engaging in an active buying spree, potentially to increase the dollar cost averaging (DCA) of their positions. Dollar-cost averaging is a strategy in which an investor divides the total amount to be invested into periodic purchases of a target asset to reduce the impact of volatility on the overall purchase. The whales’ actions suggest a belief in BONK’s potential for a strong reversal, which could allow them to mitigate their substantial losses from the recent price drop.

After a dramatic spike and subsequent drop, the token price has begun to stabilize and slowly rise. This price movement may be indicative of significant buying pressure at lower price levels as whales accumulate additional tokens in anticipation of a market turn.
The strategy of averaging down during a bearish phase can be high risk but also high reward. If timed correctly, it allows investors to reduce their average cost per token and earn more if a bounce occurs. For BONK, whale confidence could also inspire renewed interest from retail investors, who often see the actions of larger investors as signals.
However, it is important to note that such recoveries can be fragile, especially in a bear-dominated market phase. Such a volatile asset could continue to move lower for the foreseeable future, and it is important to avoid any significant bets on it.