PEPE, WIF, and BONK gain momentum as GameStop’s memecoin sends shockwaves to the market. How long will they sustain a green streak? The market capitalization of memecoins has crossed a $55 billion milestone as GameStop Corp is back in action. While the GameStop (GME) price rallied by a strong 75% on Monday, memecoin GME has kicked off by a staggering 2200%, moving top meme-inspired assets into the green zone.
As per on-chain data provider Santiment, the memecoin market witnessed an attention-grabbing upsurge on May 13, marked by notable breakthroughs. In momentum, trading volumes among the top 50 meme-inspired assets soared by over 34%.
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Source: Santiment
The memecoin frenzy even made VanEck, a leading asset manager, enter the market, as has been confirmed by Matthew Sigel, VanEck’s Head of Digital Assets.
“VanEck’s Market Vector launches MEMECOIN index, top 6 assets, 30% cap,” he noted in his post on X, adding that the index included Dogecoin (DOGE), Shiba Inu (SHIB), Pepe (PEPE), Dogwifhat (WIF), Floki Inu (FLOKI), and Bonk (BONK).
The market’s upturn is believed to be fuelled by GameStop Corp’s 74% surge, engaging short-selling hedge funds to face a mark-to-market $838 million loss. The uptick came as a result of an iconic Roaring Kitty media comeback, who used to vouch for investing in the gaming stock back in 2021.
PEPE, WIF, and FLOKI Taking a Pivot
The outburst brought reflective action to the top memecoins. Since Monday 13, Pepe (PEPE) has been indicating a strong uptrend, reaching the recent local highs. Thus, the explosive rally pushed PEPE into a new all-time high (ATH) of $0.00001146, while the coin’s 65% growth outperformed Bitcoin’s 2% price increase.
PEPE/USDT 1D chart. Source: WhiteBIT Trading View
Regardless of the latest supercycle, the frog-themed asset has been in a steady recovery through Q2, as indicated by the ascending channel (blue). According to AMBCrypto, the upswing to a new ATH reversed all losses in Q1 and partially in Q2. This means that most holders had unrealized profits and could book the gains.
While PEPE has seen two price rejections at the range-high of the ascending channel, meaning the profit booking, the memecoin is showing a strong bullish sentiment, opening the door for potential 21% gains. What is more, Coinglass’s Long/Short Ratio data marks PEPE’s sentiment as bullish, as many traders are indicated to be going long on the asset since May 7.
PEPE long/short ratio chart. Source: Coinglass
Still, based on liquidation levels, an unforeseen bearish fluctuation may drap PEPE by 25% south. The GME-originated rally also affected the Solana-based Dogwifhat (WIF). While the supercycle secured local breakthroughs of over 15%, WIF has registered a massive surge in on-chain volume, overcoming Sui Network by this criteria. Alongside, the data from Santiment marked a decline in weighted sentiment metric, signifying the growing pessimism about WIF just before the memecoin rally.
Dogwifhat (WIF) weighted sentiment. Source: Santiment
Nevertheless, the global sentiment for WIF remains in the hands of the bears, as per the chart. Thus, since April 1, after hitting the $4.857 level, the price of WIF declined significantly on the charts. Over this period, the price hit multiple lower lows and lower highs, establishing a bearish trend.
What is crucial, WIF has all chances to bounce back, as can be seen from the Relative Strength Index (RSI) and Chaikin Money Flow (CMF), which both indicated a slight uptick in response to the coin’s 4% daily recovery at the writing time.
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WIF/USDT 12h chart. Source: WhiteBIT Trading View
If the local recovery keeps up, WIF may be able to push past the $3,502 resistance level and aim for the $4,382 range soon. While PEPE has been indicating decent progress in the chart, and WIF hinting at one, FLOKI stood out with its 33% rise in momentum. The memecoin is marked not only due to its short-term pump, but an indicative potential for a long term.
As the price gave a decisive breakout from the neckline resistance of the ascending triangle pattern, this signaled the potential of a higher rally. A look at the 12h chart also reveals that the FLOKI price developed fresh higher lows signals the buyers attempt to regain control and actively accumulate at dips.
FLOKI/USDT 12h chart. Source: WhiteBIT Trading View
Regardless of the GME-initiated nature of FLOKI’s upward movement, it has driven north by 16% as Revolut Business, Europe’s leading neobank, listed the memecoin on its service.
Ifs and Buts
While the tendency is quickly earning the title of ‘supercycle’, this go-by label does not fully correlate with a factual state of things. Ansem, a reputable memecoin trader, cited the recent recovery to be “an attention thing”.
“I think it’s more of like an attention thing, and like an internet thing, than really like thinking about teams that are building out products,” he said in a recent ‘Unchained’ podcast episode.
Ansem also stressed the validity of meme coins’ prices, drawing a connection between ones and fundamental assets. He added, “Looking at price is valid because anything that people can speculate on whether it’s like stocks, crypto, altcoins, Bitcoin, Ethereum…people can buy the top and lose money. Hence, that’s not specific to memecoins.”
The controversy between speculative interest and sustainable growth was by a memecoin trader Kelxyz. Within the same polemic, he noted,
“With crypto and the ability to tokenize anything, financialize anything, it makes sense that memecoins would end up capturing a lot of that attentional flow and in turn some of that value as well.”
Seeing that public opinion gravitates towards the strong memecoins dependence upon the community interest, an X user behind @free_electron0 username summarised that we’re currently seeing “the introduction of the ‘memecoin asset class’ to the world by TradFi”.
While altcoins fundamentally taking over the crypto market, it is important to remember: “These coins are intended for entertainment purposes”, as reported by VanEck’s Matthew Sigel.
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