Memecoins
3 Meme Coins observe high-volume breakout after key support holds
Cryptocurrency markets went on a roller coaster ride yesterday, reacting to both data and .
First, a wave of optimism flooded the market as lower-than-expected inflation data triggered an inflow of nearly $80 billion.
However, this positive sentiment quickly faded after the Fed held interest rates as expected, but Fed Chair Jerome Powell triggered significant fund outflows.
initially charged at $70,000, but Powell’s statement that the Fed had no commitment to future rate cuts and would keep policy dependent on data sent prices tumbling.
Meme coins, known for their volatility, have surged during market swings.
, , and all have seen some of the highest trading volumes among altcoins. However, all three are currently at critical support levels. Let’s analyze their price action one by one:
1. Dogemoneta
Dogecoin saw a surge in the first quarter of 2024, but has been stuck in a holding pattern ever since. Over the past three months, the price has fluctuated within a 20% range.
DOGE faces resistance at $0.169, a level that has capped its gains over the past three months. However, dips below $0.137 consistently face buying pressure, suggesting support at this level. This week, DOGE successfully tested this support again and it appears to be holding.
Interestingly, the support level coincides with the 0.618 Fibonacci retracement level, calculated based on the previous uptrend. This technical confluence strengthens the possibility of a breakout from this consolidation zone.
However, for a true breakout to occur, DOGE must overcome another obstacle: a cluster of exponential moving averages (EMA) around $0.15.
If these EMAs, currently sloping down and signaling a bearish attitude, remain unchallenged by next week, selling pressure could increase. This could lead to a breakdown of the consolidation phase, potentially pushing DOGE towards the $0.11 zone.
On the other hand, a weekly close above the $0.155 level, where the EMAs are clustered, would be a significant bullish signal.
This would not only confirm a trend reversal, but would also represent a break in the downward trend that began in March, the highest point of the year. A breakout could attract more buyers and send DOGE sharply higher, potentially reaching the $0.2 range in the near term.
2. Shiba Inu
SHIB has emerged as one of the most stable meme coins in recent months. After a meteoric rise of over 350% in the February-March period, it entered a consolidation phase in April, giving back some gains but maintaining a defined trading range.
Currently, the SHIB fluctuates between $0.000021 and $0.000023. This week, it fell below the initial support at $0.000023, but a secondary support level at $0.000021 appears to be holding. The direction of the SHIB will likely depend on its weekly closing price relative to this support zone.
A break below $0.000021 could trigger selling pressure, potentially pushing the SHIB towards the $0.000017 level (0.786 Fibonacci retracement). This break would also be confirmed by a bearish crossover of the short-term moving averages (EMA), further amplifying the selling sentiment.
For a bullish scenario, a weekly close above $0.000023 is crucial. This may lead to a retest of the resistance at $0.000027. If a significant breakout occurs, accompanied by high trading volume, SHIB could target $0.000031 and $0.000037 in the near term.
3. PEPPER
Unlike Dogecoin (DOGE) and Shiba Inu (SHIB), PEPE defied May’s downtrend. It rose steadily through April, reaching a record high of $0.00001722 before a slight decline in recent days.
PEPE’s bullish momentum was fueled by a completed bullish setup at key levels of the Fibonacci expansion. However, profit taking caused a decline to $0.000012. Thankfully, this decline was stopped by a strong short-term uptrend line.
This buying reaction above the trend line suggests a potential resumption of PEPE’s upward climb. A daily close above $0.000013 in the coming days would be a strong confirmation. This move would likely push the oversold RSI stochastic indicator higher and take the price back above the 8-day and 21-day EMAs – all bullish signals.
On the upside, a potential bounce could see PEPE break above the critical resistance level of $0.000015 and potentially reach new highs in the $0.000018 – $0.000019 range.
However, a break below $0.00001160 on the daily chart would signal a trend reversal. This could lead to a prolonged correction and a possible short-term decline to the $0.000009 zone.
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Disclaimer: This article is written for informational purposes only; does not constitute a solicitation, offer, advice or recommendation to invest and as such does not intend to encourage the purchase of assets in any way. I would like to remind you that any type of asset is evaluated from multiple points of view and is highly risky and therefore any investment decision and the associated risk remain the responsibility of the investor.