Simon’s Cat crypto up 12% in a day, 86% in 3 – What’s behind the surge?

Simon’s cat crypto has a strongly bullish momentum and volume
The divergence the meme exhibited close to the two-month range high could see a pullback

As a seasoned researcher with a knack for deciphering market trends, I must say that Simon’s Cat [CAT] has been quite the rollercoaster ride this week. The coin’s listing on Binance Derivatives certainly sparked a surge that I haven’t seen since the days of Dogecoin’s moonshot.

This week, there was a significant surge in the value of Simon’s Cat [CAT], the popular meme coin. It had been moving within a specific price range since mid-September. On October 21st, it experienced a massive jump from the lower end of that range following the announcement that Binance would list the token on its derivatives platform.

Currently, CAT is being traded at a level that’s only 6.4% shy of its highest range. Yet, it’s worth noting that the price action seems to differ from the momentum indicators. Is there a possibility for a significant pullback in Simon’s cat crypto?

Signs of overextension

Simon’s Cat crypto up 12% in a day, 86% in 3 – What’s behind the surge?

In simpler terms, the price range (represented by purple) ranged from $0.0000236 to $0.0000466 over the last two months. The middle point of this range was at $0.000035, and this value has acted as both a support and resistance level during this period.

The Money Flow Index, also known as a volume-based RSI (Relative Strength Index), takes both trading volume and price information into account. Over the last two days, the oscillator has shown decreasing high points, even as the price has climbed significantly.

This situation indicates a potential decrease in price due to a bearish pattern known as divergence. Since it’s close to the upper limit of its range, it seems plausible that there will be a reversal or rejection at approximately $0.0000466, leading to a short-term drop.

In other words, if these levels at $0.000038 and $0.000035 are rejected (not broken), it could be a great chance to buy since they might serve as strong points for potential price rebounds.

Open Interest and funding rate trends

Simon’s Cat crypto up 12% in a day, 86% in 3 – What’s behind the surge?

Since Monday, the value of Simon’s cat cryptocurrency almost doubled, yet the total number of contracts (Open Interest) associated with it surged approximately 500%. On the 21st, its worth was around $6.7 million; however, as we speak, it has grown to a staggering $36 million.

Read Simon’s Cat’s [CAT] Price Prediction 2024-25

Over the last two days, the funding rate has decreased, indicating a weakening of the strong bullish sentiment that had been observed earlier in the week.

Overall, the sentiment was still bullish, but a pullback toward the mid-range level is likely.

2024-10-24 20:07

Signs of overextension

Open Interest and funding rate trends

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