Memecoins have seen strong downward pressure amid extended market weakness.
However, in the past 24 hours, memecoin market cap rose 8% to $23 billion, while trading volume rose 77% to $2.85 billion.
Amid this sector-wide trend reversal, MemeCore (M) also rebounded, It managed to hold $1.1 and climbed to a local high of 1,329.
As of this writing, MemeCore is trading at around $1.32, after rising 11.2% on the daily charts. However, trading volume fell by 13%, indicating that market participation has not yet recovered.
Demand for MemeCore is recovering amid sector-wide capital rotation
As momentum shifts across the sector, M Traders also rushed to position themselves, fearing to miss out.
As a result, memecoin open interest rose by 9.4% to $25.66 million. Such a jump in OI indicates increased participation as traders opened new positions.
In fact, significant capital has flowed into the futures market. According to CoinGlass data, MemeCore recorded $1.84 million in forward inflows compared to $1.47 million in outflows. As a result, Netflow futures fell 89% to $365,000.
Meanwhile, memecoin’s buy/sell ratio jumped above 1 across exchanges. The overall ratio was around 1.07 as of this writing, reflecting high demand for long positions.
This means that traders mostly opened buy positions, indicating an uptrend as traders expected the market to continue rising.
On the immediate side, the same feelings were observed. According to CoinGlass data, the net spot inflow of memecoin has turned negative on the 24-hour time frame.
At press time, Netflow was at -$26K, suggesting that traders were also buying in an attempt to chase the rally. Often, strong demand, especially speculative demand, is preceded by strong short-term price pumps.
What momentum indicators indicate
As MemeCore has seen a rebound in demand, memecoin’s bullish momentum has strengthened slightly. For example, the Relative Strength Index (RSI) of memecoin formed a bullish crossover and rose to 47.
At these levels, the Relative Strength Index showed that buyers are back in the market, but have not yet fully regained control. The EMA further confirms this strength in the short term.
M inverted the 20-day EMA, indicating short-term strength. These two momentum indicators show a recovery in demand, which has given the market some support so far.
If demand continues, the RSI will turn 50, confirming the continuation of the trend. By doing so, MemeCore will flip the 50-day moving average at $1.7.
However, if this attempt fails, it will mean that it has failed to regain control of the market, and another pullback to $1.1 will follow.
Final summary
- M stock rose 11.2% after successfully holding $1.1 to $1.3 amid a sector-wide recovery.
- Demand for MemeCore has returned as the memecoin sector has seen a renewed rotation of capital.
