Why Popcat (POPCAT) May Stall Before Reaching $2
Solana-based meme coin Popcat (POPCAT) has experienced a significant price surge, climbing to $1.37, an 89% increase over the past 30 days. This impressive rally has attracted attention from traders.
However, as profit-taking begins, POPCAT may see some of these gains start to diminish, with a potential pullback on the horizon.
Bearish Divergence Indicates Weak Demand for Popcat
POPCAT’s Chaikin Money Flow (CMF) has gradually declined since the beginning of the month. This has occurred despite the meme coin’s rally, creating a bearish divergence. At press time, POPCAT’s CMF is below zero at -0.05.
The CMF indicator measures money flow into and out of the market. When the CMF declines while an asset’s price rises, it creates a bearish divergence, indicating that upward price movement might not be supported by strong demand.
Read more: 12 Best Altcoin Exchanges for Crypto Trading in October 2024
POPCAT CMF. Source: TradingViewFurthermore, the sharp rally in POPCAT’s value has caused market volatility to skyrocket, as evidenced by the widening gap of its Bollinger Bands indicator. Traders use this indicator to assess market volatility and potential price movements.
When the gap between this indicator’s upper and lower bands widens, it signals increased market volatility and the potential for significant price changes. Moreover, POPCAT’s price briefly moved above the upper band of this indicator during the weekend sessions.
Trading above this level indicates that the asset may be overbought. It suggests that its price has risen significantly and may be due for a pullback. Traders often view this as a warning sign that the current upward momentum may not be sustainable.
POPCAT Bollinger Bands. Source: TradingViewPOPCAT Price Prediction: Buyers May Soon Tap Out
Buyers’ exhaustion is common in an overheated market. As selling pressure spikes, POPCAT’s price is likely to decline further.
Using the Fibonacci Retracement tool suggests that the meme coin’s value could drop by 34%, potentially settling at the key support level of $0.90.
Read more: 11 Top Solana Meme Coins to Watch in October 2024
POPCAT Price Analysis. Source: TradingViewConversely, if demand picks up, POPCAT’s price may reclaim its all-time high of $1.55 and surge beyond that level.
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
You may also like
Hyperliquid launches native token HYPE
Ethena and Securitize propose USDtb for Spark’s $1b Tokenization Grand Prix
Standard Chartered Analysts Predict Stablecoins Will Represent 10 Percent of US Economy in the Future!
Analysts at Standard Chartered and Zodia Markets predict that stablecoin adoption will see significant growth, potentially representing 10% of US M2 transactions in the future.
Is $100,000 the Limit in the Bitcoin Rally or Will It Continue? Here’s a Clear Opinion for the Top
While the Bitcoin price has reached the $100,000 limit, the questioning of what goes beyond this level has begun. Here are the details.