There has been a considerable decrease in the value of Floki [FLOKI], with a 9.94% decline observed over the past 24 hours. Supported by recent technical advancements and existing data pointing towards a bearish perspective, the memecoin may continue its downward trend.
Nevertheless, it is essential to acknowledge that the downtrend in FLOKI is not definitively confirmed, leaving space for a possible upswing. To explore this further, CryptoCrypto offers a detailed examination.
Could FLOKI Experience a 65% Drop?
This particular pattern is characterized by a significant price fall, followed by a consolidation phase where the price moves within a narrow range showing an upward trend before a sharp downward breakout occurs.
Typically, this decline happens after the price encounters the main resistance level of the channel and breaches the support line. At present, FLOKI was approaching the support area within the channel.
If a breakout occurs from this point, there are two specific targets to monitor.
The primary target for FLOKI is the lower boundary of the channel, currently standing at 0.00009585.
If history repeats itself with a significant downward movement preceding consolidation, FLOKI might potentially fall further to reach 0.00005373.
Potential Pause in the Decline?
Further examination reveals that Coinglass has recorded a notable outflow of FLOKI, particularly noticeable on Binance, where $2.06 million worth of FLOKI was moved out in the past 24 hours.
This trend of negative outflows has been consistent over the past week.
Such negative outflows typically result in a supply constraint, as the limited availability of FLOKI could spike demand, subsequently driving its price up.
Contrastingly, the Open Interest (OI), an indicator of market sentiment, displays a different scenario. The OI has experienced a sharp decline of 25.79%, dropping to $17.88 million.
This substantial dip indicates a prevailing bearish sentiment among traders, potentially overshadowing the impact of the ongoing supply squeeze.
Bearish Sentiment Persists
Using the Relative Strength Index (RSI), Cryptocrypto has identified that traders are continuing to place bets against FLOKI.
Illustrated by the RSI crossing below the neutral mark of 50 and sustaining its downward trajectory.
Given this momentum, the memecoin is likely to revisit the starting point of the channel at $0.00009585. Should the current market sentiment endure, it could further accelerate a decline towards the channel’s lower target.