FLOKI, the popular dog-themed memecoin, has recently encountered substantial bearish pressure, leading to a price decline of over 21% in just a day. This drop has positioned FLOKI as the day’s top loser in the ongoing market downturn, with the token now trading at $0.0001224.
Moreover, FLOKI’s market capitalization has sharply declined to $1.172 billion, making it the sixth-largest meme coin by market cap. This decline has enabled Bonk Inu (BONK) to overtake FLOKI, securing the fifth spot with a market cap of $1.209 billion.
Market Dynamics and Sell-Off Pressure
The recent downturn in FLOKI’s price can be attributed to significant market activities revealed by data from Spot On Chain. According to the report, a wallet linked to the dog token deposited over 15 billion tokens, approximately worth $2.3 million, to Binance just hours before the price began to decline.
The $FLOKI price is ???? 17.7% in the past 24 hours.
A wallet linked to @RealFlokiInu returned after 2.5 years of dormancy and deposited 15.22B $FLOKI ($2.27M) to #Binance 9 hours ago, just before the price plunged.
These $FLOKI were released from the Floki deployer to this… pic.twitter.com/9eDNqy3Mhr
— Spot On Chain (@spotonchain) August 30, 2024
Notably, the wallet had been inactive for two and a half years, having accumulated its FLOKI stash in early 2022, when the token was valued at $0.0000307. Supposedly, if the wallet’s owner sold all their tokens immediately after the deposit, they would have realized a profit exceeding $1.8 million.
Such large-scale sell-offs often flood the market with additional tokens, which, without a matching surge in demand, can trigger a price drop. This sudden influx of supply can likely rattle investors, sparking panic and amplifying the downward momentum in the token’s price.
FLOKI to Retest the $0.0001096 Support
The memecoin is now on the brink of retesting a crucial support level at $0.0001096, a key threshold that could determine the token’s short-term trajectory. Last week, the token broke through the $0.0001441 resistance level only to face a significant sell-off, driving it back toward the $0.0001096 support.
Technical indicators support the likelihood of this retest, with the Relative Strength Index showing a sharp downward movement. This downward trend in the RSI suggests that the bearish momentum could continue, potentially leading to further declines in FLOKI’s price in the near term.
Despite the bearish outlook, some analysts remain optimistic about FLOKI’s long-term prospects. For instance, prominent crypto analyst CryptoJelleNL noted that if the memecoin manages to bounce back from its current support level, it could lay the foundation for a new upward push toward the $0.00021 mark, a level last seen in July.
As expected, $FLOKI is retesting the support level – after pushing back above it last week ????
Bounce here and we'll lock in the range low deviation + reclaim of key support, laying the foundations for a new push towards the mid-range.
Let's see! https://t.co/mxlknPg62P pic.twitter.com/KjczrJGEbE
— Jelle (@CryptoJelleNL) August 30, 2024
This potential bounce-back could signal a recovery and re-establish key support, offering investors a target to watch closely. Similarly, another market observer, Crypto_Scofield, has expressed confidence in the dog-themed coin’s ability to recover aggressively after the current dip, citing the token’s strong fundamentals as a driving force.
However, the market will need to stabilize, and investor sentiment will play a crucial role in determining FLOKI’s trajectory in the coming weeks.
Also Read: ChatGPT Predicts DOGE Price Surge 11,078% Reaching $9 by 2025