On Monday, Bitcoin experienced a nearly 10% drop, falling below its all-time high of $104,088 to a low of $94,150. While the flash crash was short-lived, it negatively impacted altcoins and meme coins, including Dogecoin, Shiba Inu, Pepe, Dogwifhat, and Bonk.
Market Crash Signals the End of Altcoin Season
Over the past 24 hours, the top 10 meme coins by market capitalization suffered almost double-digit losses. The altcoin season appears to be over, raising the question of whether meme coins can recover and find their cyclical bottom.
On Tuesday, Bitcoin traded 6% below its all-time high, marking the end of the altcoin season. The Altcoin Season Index recorded a value of 65 on a scale of 0 to 100, confirming the shift away from altcoin dominance.
Bitcoinās technical indicators show mixed signals. The Relative Strength Index (RSI) is at 59 and trending upward, while the Moving Average Convergence Divergence (MACD) suggests a negative trend. A further decline in Bitcoin could trigger additional sell-offs in meme coins across derivative exchanges.
Meme Coins Face Heavy Losses
The meme coin category lost nearly 15% of its market capitalization in the last 24 hours, dropping to $128.26 billion. While some tokens showed slight recovery, major meme coins continue to experience significant corrections.
Historically, altcoins tend to recover during the Christmas season when lower trading activity and volumes create favorable conditions for price movements. If this trend repeats, Dogecoin and other meme coins could regain some of their losses by the end of 2024.
Performance of Major Meme Coins
Despite recent declines, meme coins have delivered substantial gains for holders in 2024:
Dogecoin (DOGE): Up 350% since the start of the year.Shiba Inu (SHIB): Up 160%.PEPE: A staggering 1,860% increase.Dogwifhat (WIF): Up 145%.Bonk (BONK): Up 180%.
These figures support optimistic expectations for a year-end recovery in the meme coin category.
Factors Driving the Meme Coin Market
Key drivers of meme coin rallies this cycle include:
Donald Trump: His administrationās plans to support blockchain technology.Elon Musk: His comments and endorsement of Dogecoin.Capital rotation: A shift from altcoins to meme coins during their seasonal rally.
DOGE, SHIB, PEPE, WIF, and BONK maintain their status as āblue-chipā meme coins due to their market capitalizations. Despite recent setbacks, they continue to play a significant role in the cryptocurrency landscape.
Technical Analysis and Future Outlook
Dogecoin (DOGE): Currently trading 22% below its 2024 high. Key resistance at $0.60000, with a buy zone between $0.29874 and $0.35740.
Shiba Inu (SHIB): Down 23% from its peak of $0.00003343. Expected to rebound to $0.00004567.
PEPE: In its buy zone, with a target price of $0.00003691.
Dogwifhat (WIF): Historical high at $4.860, buy zone between $2.438 and $2.649.
Bonk (BONK): In its buy zone, with a target price at the all-time high of $0.00006230.
LBank, a cryptocurrency exchange platform, identified the top 10 meme coins of 2024 that include tokens that are not considered blue-chip but outperformed the sector.Ā
Strategy for Trading Meme Coins
Bitcoinās price drop caused meme coins to lose significant market value, as they typically react negatively to Bitcoin corrections. Traders should focus on meme coins with strong communities, liquidity, and relatively high market capitalizations to minimize risks.
Although the altcoin season has ended, meme coins might still surprise with a recovery during the holiday season.
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