POPCAT maintained a bullish market structure and the pullback has been minor.
A deeper correction is anticipated, but the selling pressure was weak at press time and such a drop could take time.
Popcat [POPCAT] made gains of 482% from the 17th to the 26th of April. It had a market cap of $406 million at press time.
The recent gains brought it to the spotlight and speculators have piled on in hopes of making a quick profit.
Technical analysis showed that the structure and momentum were bullish but could turn bearish in the near term.
A deeper retracement could come in the following weeks after the sizeable rally it made earlier this month.
Plotting the Fibonacci retracement levels
Source: POPCAT/USDT on TradingView
The market structure on the 4-hour chart was strongly bullish. The near 500% gains saw a minor retracement to the $0.328 level. This region is a former resistance zone that was flipped to support.
Moreover, the Fibonacci retracement levels (pale yellow) outlined the $0.328 and $0.195 as the levels to watch. Both levels stand at a technical support zone based on the price action earlier this month.
The RSI on the 4-hour chart was at 48, showing a potential shift toward bearish. The OBV maintained its uptrend despite the pullback from $0.555 in recent days.
To the north, $0.669 is also a resistance level of interest.
Sentiment was beginning to weaken again
Source: Coinglass
The strong gains ten days ago saw millions of dollars flow into the futures market as speculators flocked to POPCAT. In the past five days, the price began to pull back, and bearish sentiment gained some strength.
Realistic or not, here’s POPCAT’s market cap in BTC’s terms
The Open Interest was slowly falling lower as conviction in the short-term bullishness of the meme token began to falter. This is expected to continue.
A deeper price retracement toward the $0.2 support zone before another rally would be healthy. It would also give the market time to consolidate after the recent gains.
Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion.
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