- The Memecoin sector took a huge hit after SHIB, WIF and PEPE saw corrections
- Traders were particularly bearish on PEPE
The memecoin sector has seen significant growth since the beginning of the year. However, the sector’s growth rate came to an abrupt halt after Bitcoin’s fall below $67,000 caused a market-wide depreciation. Due to their high correlation with the king coin, companies such as SHIB, PEPE and WIF were not immune to this.
All good things end?
In the past 24 hours, popular memecoins such as dogwifhat have become popular [WIF]PEPE [PEPE]and Shiba Inu [SHIB] saw their prices drop significantly. AMBCrypto’s analysis of CoinMarketCap data showed that WIF fell 21.33%, while SHIB and PEPE saw their prices drop 12.50% and 19.23% respectively.
PEPE and SHIB had been moving sideways for quite some time, before this particular correction. The shock came for WIF holders as WIF’s price action showed no signs of slowing down the charts.
Source: Santiment
One of the main drivers of memecoins’ price movement is how they perform on social media. WIF continued to dominate in this area, compared to other memecoins. WIF had the highest activity in terms of social volume of the three memecoins. PEPE came second in terms of social activity and SHIB came third.
PEPE and SHIB would need to gain popularity and gain more attention on social media to see a revival in the price. If WIF continues to capture market share and people’s attention, it would become harder for other memecoins to compete and stay relevant.
Source: Santiment
Look at the sentiment
In terms of sentiment, SHIB and PEPE did relatively well. In fact, Santiment’s data showed that weighted sentiment for SHIB and PEPE increased, implying that there were more positive reactions than negative reactions around these tokens at the time of writing.
However, WIF struggled in this department. Weighted sentiment has dropped significantly in recent days, which could be caused by the recent price drop. Because WIF does not have its own ecosystem or community, much of the sentiment surrounding the token is directly correlated to its price movements.
As a result, tokens like WIF are extremely vulnerable when there are market downturns.
Source: Santiment
However, despite the negative sentiment, traders have remained relatively neutral on WIF and SHIB. Traders had taken equal parts long and short positions.
However, traders were extremely bearish on PEPE at the time of writing. Coinglass data shows that the percentage of short positions taken against PEPE has grown to 52% in the past few hours.
Read Shiba Inu’s [SHIB] Price forecast 2024-25
Source: Coinglass