ONDO price prediction: can bulls defend key support near $0.33?

Ondo Finance ONDO has extended its losing streak to Thursday, dropping below the critical $0.4000 mark as it faces mounting selling pressure. 

After experiencing three consecutive days of declines, ONDO has extended its correction from its May peak of $0.4877, raising concerns of a potential deeper correction. 

Ondo’s May rally fades as retail demand declines

ONDO was one of the best performers earlier this month, recording massive gains.

Its rally in the first week of May was largely driven by increasing retail interest, which helped push futures Open Interest (OI) to $245 million—its highest level since October. 

The rally was fueled by the first-ever successful interbank settlement of tokenized short-term United States (US) Treasuries' pilot in collaboration with JPMorgan, Mastercard and Ripple.

However, since then, Open Interest has steadily declined, falling from nearly $229 million to $179 million as of Thursday.

This drop in demand from the derivatives market signals a retreat in investor confidence, further weighing on Ondo’s price. 

As Open Interest dwindles, traders are reducing their risk exposure, adding to the downward pressure on ONDO’s price. 

Despite these challenges, the futures market indicates potential for a rebound.

Ondo’s futures Weighted Funding Rate remains positive at 0.0049%, suggesting that long-positioned traders remain dominant and are willing to pay a premium to maintain their positions. 

This continued conviction could support a recovery if buy-the-dip demand materializes. 

Technical analysis: Ondo bears target the $0.3348 support

The ONDO/USD 4-hour chart remains bullish thanks to Ondo Finance’s rally earlier this month.

At press time, ONDO is trading at $0.38305, maintaining a constructive bullish bias as it holds well above the 50-day and 100-day Exponential Moving Averages (EMAs), clustered around $0.3100. 

The bulls are holding ONDO’s price above the SuperTrend support near $0.3348. The momentum indicators on the 4-hour chart suggest that the bulls are losing control.

The Moving Average Convergence Divergence (MACD) histogram has dropped to the negative region on the 4-hour chart, indicating a bearish bias.

The Relative Strength Index (RSI) hovers at 44, suggesting a growing bearish bias.

If the bulls regain control of the market, they would encounter immediate resistance at the 200-day EMA around $0.4017. A clean daily close above this level would open the door to a continuation of the recent rally.

However, if the selloff continues, the bears would encounter a strong support level near $0.3348.

Failure to defend this support level would expose lower demand zones close to the 100-day EMA at $0.3132 and the 50-day EMA at $0.3055.

These levels could allow for a pullback as buyers could step in and absorb the selling pressure. 

The broader cryptocurrency market is still undergoing selling pressure.

Unless the bulls regain control, ONDO and other leading crypto assets could underperform in the near term.