MemeCore (M) has recently captured attention with a significant price surge, mirroring the broader resurgence of the memecoin sector. While robust inflows from derivative markets fuel its impressive gains, a closer look reveals underlying trading patterns that raise questions about the long-term viability of this rally.
MemeCore's Surge: A Mix of Sector Growth and Derivative Inflows
MemeCore (M) recently experienced a notable 16% rally, aligning with a broader 66% monthly gain observed across the memecoin sector. As a foundational layer supporting various memecoins, M's demand has naturally escalated amidst this sector-wide boom. The primary catalyst behind its immediate price increase appears to be substantial capital inflows from the perpetual futures market. A significant 17% surge in Open Interest, coupled with positive funding rates, strongly indicates that long positions are driving the current momentum, with short sellers experiencing considerable liquidations. This suggests traders are actively anticipating further upward movement, creating conditions for a potential short squeeze.
Sustainability Concerns Emerge Amidst Divergent Trading Signals
Despite the compelling rally, several indicators suggest a cautious outlook on MemeCore's sustainability. Activity in the spot market, where long-term conviction is typically forged, remains strikingly low with minimal purchases, implying a hesitant investor base. Furthermore, derivative trading data reveals a dominance of taker-sell orders, accounting for 66% of total volume, which suggests selling pressure is controlling market flow rather than genuine buying demand. This imbalance, alongside a stark disparity between M's $2.66 billion market capitalization and its meager $45 million spot trading volume, points to weak underlying support, leaving the asset vulnerable to a potential pullback without more robust buying interest.
