- The bullish market structure and buying pressure could lead to FLOKI extending its rally
- Liquidation data showed a price drop was likely
The recovery effort was relatively strong for Floki Inu [FLOKI]. Since the steep drop on August 5, FLOKI is now up almost 52%, compared to that of Bitcoin [BTC] 31%. Furthermore, FLOKI also imposed a bullish market structure on the one-day time frame.
This could pave the way for the memecoin to regain its levels before the price drops started in late July. At the time of writing, a 20% increase seemed likely.
The daily close encourages another step higher
Source: FLOKI/USDT on TradingView
The price action on the 1-day chart was bullish after the recent move past $0.00014. Retesting the $0.000138 region as support would provide a buying opportunity targeting $0.000176, the next significant resistance.
The MACD, although below zero, formed a bullish crossover and indicated that downward momentum was quickly losing its grip. The OBV climbed higher over the past week, but was nowhere near the highs seen in late July.
It should be noted here that FLOKI seemed to break the downtrend on the daily time frame but was eventually forced down. The most recent example occurred on July 21, when a local resistance zone was breached but the buyers were unable to defend it.
FLOKI’s liquidity levels show a strong bullish bias
The cumulative delta of the liq levels was intensely positive, indicating a large difference between the long and short liquidation levels over the past few days. This bullish expectation could lead to long positions coming under pressure, although this cannot be guaranteed in any way.
The liquidation heatmap provided another reason for bearish expectations. The $0.00015 pocket was the main liquidity cluster in the North and appeared to have been wiped out over the past 24 hours.
Realistic or not, here is FLOKI’s market cap in BTC terms
There is more liquidity, but traders may also be wary of a bearish reversal in the near term. A sustained decline below $0.000128 would signal that $0.0001 is the next target.
Disclaimer: The information presented does not constitute financial advice, investment advice, trading advice or any other form of advice and is solely the opinion of the writer