FLOKI gains 173% in 2 days: Should you start profit-taking?
FLOKI could continue to rally, but bulls should wait for better risk-to-reward conditions to buy more.
- FLOKI bulls could look to book profits after its extraordinary run.
- The retracement might not be as deep as traders hoped for.
Floki Inu [FLOKI] witnessed a downtrend in December and January, but the market structure shifted bullishly on the one-day timeframe on the 20th of January. This saw the meme coin trend slowly upward.
The slow trend turned into a rocket ship over the past ten days as FLOKI gained 351% from bottom to top. At press time, it was down by just under 12% over the past twelve hours.
The rally might not have ended
Owing to the 12% dip, the way the Fibonacci retracement levels (pale yellow) were plotted appeared feasible.
Yet, since the bullish sentiment behind FLOKI remained strong, it could continue higher to set new highs in the coming days.
The RSI on the 12-hour chart went to 91 on the 2nd of March. The closest to this value was 87.1 the meme coin registered in the second half of October last year.
It highlighted how extreme the current momentum was.
A retracement, while inevitable, need not arrive immediately. Hence, shorting the token remains a risky option.
On the other hand, the Fibonacci retracement levels highlighted where buyers could re-enter the long FLOKI trade.
Selling pressure had begun to climb
The active addresses count shot higher over the past couple of days as prices appreciated rapidly. However, the dormant circulation also had a large spike.
This indicated a flurry of previously idle FLOKI tokens being moved, and could be a sign of profit-taking from holders. In tandem, the mean coin age metric also fell, reinforcing this idea.
Realistic or not, here’s FLOKI’s market cap in BTC’s terms
Encouragingly for the bulls, the realized cap was near the highs last seen on the 10th of January. This showed increased accumulation of the meme coin, and that they were being held for longer.
This metric highlighted that token movement has not been very high, despite the dormant circulation spike. So, FLOKI could continue to rally, but bulls could wait for better risk-to-reward conditions to buy more.
Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion.
