The cryptocurrency market is experiencing a noticeable decline in meme coins. BTC and ETH are leading this trend. In the meme coin market, led by Dogecoin, Shiba Inu, and Pepe, a below-expectation performance was observed as of June 18, marking one of the most evident points of decline. According to data provided by CoinMarketCap, meme coin volume dropped by 11% in the last 24 hours, falling to $45.31 billion. Despite this, daily trading volume increased by 79%, reaching $6.25 billion, indicating an effort to liquidate. So, why are meme coins falling?
Market Outlook Weakens
Historical market trends show that bull markets generally start with Bitcoin and Ethereum and then affect altcoins. Considering the market correction, the Total3, which excludes BTC and ETH, rose to $720 billion on June 5 before pulling back.
The chart below shows that Total3 has decreased by 19% since that date, falling to $582.88 billion at the time of publication. This pullback has led to the emergence of a descending parallel channel on the daily chart, as shown below.
During this period, the daily relative strength index (RSI) fell below the overbought zone just before reaching 70, indicating that investors were taking profits as Ethereum-based meme coins, led by PEPE, were rising.
An RSI value close to 70 means that altcoins are overvalued, leading to a trend reversal or a corrective pullback.
The technical analysis above shows that the downtrend in altcoins continues, causing the Total3 indicator to continue moving downward within the descending parallel channel. The RSI value also showed a decline from 62 to 30 over a two-week period, which can be interpreted as intense bearish pressure.
Meme Coin Trading Volume Declines
In March, meme coins had completely taken over the market. However, a noticeable decline has been observed since then.
According to data provided by Dune Analytics, meme coin transactions across all networks, including Ethereum and Solana, fell from a peak performance of $996.7 million in March to $30.35 million in the week ending June 14.
Specifically, when examining DOGE, which is at the top of the market, trading volume fell by 41% between April 17 and June 17. On the other hand, data for SHIB and PEPE showed declines of 68% and 34%, respectively.
