MELANIA Token Plummets to Record Lows Amid Broad Market Liquidation Event – Key Insights

The MELANIA token has experienced a severe price decline, reaching its lowest historical valuation following a sector-wide risk-off movement. This downturn aligns with a broader deleveraging trend across digital asset markets, as traders reduce exposure to altcoins amidst heightened volatility. Technical indicators suggest the sell-off may have triggered stop-loss cascades, exacerbating the downward momentum. Market analysts are monitoring whether this represents a capitulation event or requires further downside exploration before establishing a new equilibrium. Liquidity conditions appear strained, with order book depth significantly reduced on major exchanges. The token’s performance against benchmark assets like BTC and ETH shows particular weakness, underperforming the broader altcoin market during this correction phase.

Source: Coinglass

Looking further, this uptick in selling can be evidenced as spot netflows have remained positive over the past 4 days. Positive netflows mean that exchanges are seeing more deposits than withdrawals. This is also a sign of strong selling activity across market participants.

With these selling activities, the question arises – Is MELANIA set for more losses?

Is the memecoin set for further losses?

According to AMBCrypto’s analysis, the memecoin has been seeing strong downward momentum amidst mounting bearish sentiments.

For starters, we can see these bearish sentiments as investors are mostly taking short positions now. In fact, the aggregated funding rate has remained negative over the past 7 days.

A negative funding rate means that shorts are paying longs. Right now, there’s a higher demand for shorts positions in the market as they expect the price to decline further. This is a bearish sign.

Source: Coinalyze

Additionally, the memecoin’s Open interest-weighted funding rate has remained negative over the past 3 months too. This also validated our observation that investors are mostly shorting the memecoin as they anticipate a further drop.

Finally, looking at MELANIA’s price charts, its RSI declined to hit 15 within the oversold territory. A drop in RSI to such levels means sellers are mostly dominant – A sign of high selling pressure.

Source: Coinglass

Simply put, if the prevailing market trend continues, the memecoin could see more losses on its price charts.

We might see the memecoin drop to another ATL around $0.34. However, if buyers return to the market, they can push the memecoin back to $0.42.