Is the meme season coming again? The day before yesterday, Binance listed three meme coins in one day. One of them, NEIRO, has nearly tripled in the morning (calculated based on the price 15 minutes after the opening, the lowest price is not available to ordinary people)

Analysis of the increase in the popularity of meme coins, it is estimated that there are three aspects:

1. Market sentiment

The popularity of meme coins is usually closely related to market sentiment, especially when the market is optimistic or speculative. The recent activity of the crypto market has increased, the Federal Reserve's interest rate meeting is imminent, and market sentiment is volatile. Meme coins are prone to large sell-offs when sentiment falls. Therefore, if sentiment support is strong, Meme coins do have certain trading opportunities in the short term.

2. Sector rotation

Sector rotation is a market phenomenon in which different categories of cryptocurrencies or assets are favored by investors over time. Recently, when the gains of mainstream currencies (such as Bitcoin and Ethereum) have weakened, funds may flow to the Meme coin sector with higher risks and greater volatility. Meme coins usually gain huge liquidity through community support and short-term speculation, so in a specific rotation cycle, Meme coins may have certain investment opportunities.

3. Comparison of other sectors

Compared with DeFi, NFT, Layer2 and other sectors, although Meme coins have fewer actual application scenarios and innovations, they rely more on market sentiment. But the price performance of other sectors this year is really disappointing. And Meme coins tend to show greater volatility when the overall market pulls back. Therefore, compared with relatively stable sectors, Meme coins have greater short-term volatility and opportunities, but also higher long-term risks. For speculators seeking short-term high returns, Meme coins have certain trading opportunities, but for long-term investors, the risks are more difficult to control.

I think of my bottom meme coin $DOGS

Is there another chance? At present, in the meme sector, I only like DOGS, and I have no other positions. In terms of risk sharing, it would be safer to hold 2-3 positions in the same sector. Unfortunately, the funds are trapped in this round and I can't build additional positions.

Summary: The recent popularity of Meme coins is mainly due to the rotation of sectors and the promotion of market sentiment. There may be speculative opportunities in the short term. However, compared with other sectors, its foundation is relatively weak and the risk is relatively high, so it needs to be participated in with caution.