Memecoins
Why “Struggling” Bitcoin May Be Good News for Market Memecoins Now
- Bitcoin talk appears to be running out of steam, with traders now focusing more on altcoins
- Memecoin mania is strong, but this could be a warning for traders
Bitcoin [BTC] retraced almost all of its gains after breaking above the $67,000 resistance level on May 20. It extended to $71.9k, but fell again to test $67k on May 23.
This consolidation implies that Bitcoin’s bullish strength is not as high as investors would have hoped. In fact, a recent report from AMBCrypto explored some relevant Bitcoin metrics, finding that many of them remained bearish.
Memecoins have managed to capture public interest
Source: Perspectives on feeling
In a post on (formerly Twitter), Feeling shared some information about crypto trends on social media. Memecoins have gained more public attention since mid-April due to their superior performance as a sector.
Tokens like dogwifhat [WIF], FLOKI [FLOKI]And Shiba Inu [SHIB] performed well over the past week. Pepe [PEPE] has also seen remarkable gains over the past two weeks, with the altcoin up 63% since April 20. This happened at a time when Bitcoin attempted to break above $67,000, but did not see a strongly bullish result.
The heavy engagement with memecoins could be a sign that the market is greedy and speculative and is not in an organic development phase, where the public is looking for tokens with good technology and utility.
Now the Bitcoin ETF Entries have been positive lately and the month of May ended well too. However, it remains to be seen whether this will be enough to start a new recovery this week.
Source: Perspectives on feeling
The data also showed that Bitcoin discussions were declining. According to Santiment, this was due to traders becoming increasingly obsessed with altcoins for potential gains, while Bitcoin procrastinated below the $70,000 resistance.
Large-cap dynamics have been mostly bullish
Source: Perspectives on feeling
The RSI on the one-day interval revealed that most major tokens were near or above the neutral mark of 50, signaling a bullish trend. Ethereum [ETH] And Solana [SOL] were the strongest with readings of 67 and 55, respectively.
In the meantime, Cardano [ADA], XRPAnd avalanche [AVAX] has struggled to gain bullish traction on the charts.
Source: Axel Adler on X
Here it is also worth noting that the trading volume of major altcoins fell dramatically compared to March. Crypto analyst Axel Adler highlighted this in an article on X, saying that Bitcoin’s lack of momentum has affected sentiment in the market.
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The volatility and trading volume behind Bitcoin has declined since March, and the price continues to trade in a range of $60,000 to $72,000. Investors need to be patient, while traders need to watch out for range formations and not get caught out by false breakouts.