Memecoins
Why Bitcoin ‘struggling’ could be good news for the memecoin market now
- Bitcoin discussions appear to be slipping, with traders now more focused on altcoins
- Memecoin mania is going strong, but this could be a warning for traders
Bitcoin [BTC] it retraced nearly all of its gains after breaking above the $67,000 resistance level on May 20. He extended higher to $71.9K, but fell to test $67K again on May 23.
This consolidation means that Bitcoin’s bullish strength is not as strong as investors would have hoped. In fact, a recent AMBCrypto report explored some relevant Bitcoin metrics, finding that many of them remained bearish.
Memecoins have managed to capture public interest
Source: Insights into holiness
In a posted on X (formerly Twitter), Most Holy shared some insights into crypto trends on social media. Memecoins have captured more public attention since mid-April due to their superior performance as a sector.
I like the tokens dogwifthat [WIF], FLOKI [FLOKI]AND Shiba Inu [SHIB] recorded good performances in the last week. Pepper [PEPE] has seen notable gains in the last two weeks as well, with the altcoin up 63% since April 20th. This came at a time when Bitcoin tried to break above $67,000, but did not see a strongly bullish outcome.
The strong 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 pursues tokens with good technology and utility.
Now the Bitcoin ETF Inflows they have been positive recently and the month of May also ended well. However, it remains to be seen whether this will be enough to kickstart another rally this week.
Source: Insights into holiness
The data also showed that discussions about Bitcoin were sliding downwards. According to Santiment, this is due to traders becoming increasingly fixated on altcoins for potential gains, while Bitcoin moved below the $70,000 resistance.
Large-cap momentum has been bullish for the most part
Source: Insights into holiness
The RSI on the 1-day timeframe revealed that most major tokens were near or above the neutral mark of 50, signaling a bullish attitude. Ethereum [ETH] AND Solana [SOL] were the strongest with readings of 67 and 55, respectively.
In the meantime, Cardan [ADA], XRPAND Avalanche [AVAX] has struggled to gain bullish traction on the charts.
Source: Axel Adler on X
It is also worth noting that the trading volume of major altcoins has decreased dramatically compared to March. Crypto analyst Axel Adler highlighted this in a post on X, arguing that Bitcoin’s lack of momentum has affected sentiment across the market.
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Volatility and trading volume behind Bitcoin have decreased since March and the price continues to trade in the $60,000 to $72,000 range. Investors need to be patient, while traders need to pay attention to range formations and not be fooled by false breakouts.