USELESS Coin up 12% as leverage rises sharply – Will it hold above $0.07?
USELESS Coin sees a 12% surge, raising questions about its ability to remain above $0.07 amid rising leverage and renewed memecoin interest.
With memecoins making headlines again, the sudden surge of USELESS Coin has caught many traders by surprise. Just yesterday, it shot up by an impressive 12% in a 24-hour period, shifting a weekly trend from losses to a gain of approximately 5%. The renewed interest in memecoins has triggered a notable spike in Open Interest (OI), creating a buzz in the crypto market.
What Are the Driving Forces Behind USELESS Coin's Surge?
The resurgence in USELESS Coin’s price coincided with similar movements from other popular memecoins like FARTCOIN, BONK, and dogwifhat [WIF]. What sets USELESS Coin apart is its remarkable market leverage. As of the latest reports, it boasts the highest OI-to-market-cap ratio at 11.86% among memecoins currently listed on Binance perps. The exact figures reveal an OI of $8.30 million against a market cap of $70 million.
How Does Leverage Impact the Market for USELESS Coin?
The notional value of outstanding derivatives contracts for USELESS Coin has seen a significant uptick on both centralized and decentralized exchanges. On platforms like Lighter, which made USELESS Coin one of its prime listings, it shows more perps OI compared to almost every other memecoin, aside from TRUMP.
This excessive market leverage indicates that the current rally was propelled by heightened trading activity and speculation. However, it comes with caveats. When Open Interest skews excessively, it can lead to heightened vulnerability for traders, particularly in the event of rapid deleveraging, liquidation cascades, or severe price squeezes.
Can the Bulls Sustain This Momentum?
The recent price increase has been driven by an explosive buying volume, which has surged by 9.9x in the last 24 hours. This bullish momentum reached its peak when the price hit $0.07745, following a significant short squeeze that occurred just above the critical level of $0.07065.
However, the market remains precarious. While bulls have been actively defending key levels—especially liquidity clusters near the $0.070 handle—there are concerns that a drop below this threshold could negate the bullish outlook and signal a further decline.
Will USELESS Hold Above the $0.07 Neckline?
USELESS Coin has exhibited signs of a bullish reversal pattern on its 4-hour chart, yet it is currently trading below a previously established ascending trendline, which now acts as resistance. In the aftermath of such a rapid ascent, a retracement is common, and USELESS Coin appears to be retesting that critical $0.070 level.
A rising Chaikin Money Flow (CMF) reading of 0.16 suggests that bulls are indeed buying at this retest, which might pave the way for a breakout. Moreover, the coin's correlation with established memecoins like BONK stands at 0.73, indicating a certain degree of cohesion in trading patterns among these assets.
Should USELESS drop below the $0.070 mark, it would imply a risk of invalidating the current bullish scenario. On the other hand, a successful reclaim of the trendline would bolster the case for a bulls' resurgence.
Key Takeaways
- USELESS Coin surged by 12% in just 24 hours, erasing weekly losses.
- It has the highest OI-to-market-cap ratio of 11.86% among memecoins on Binance.
- Buying volume increased by 9.9x, driving prices higher.
- The critical support level is set at $0.070; failure to hold may cause further downside.
- Correlation with other memecoins like BONK indicates potential for sustained momentum.
This recent activity around USELESS Coin underscores the volatile yet captivating nature of the memecoin market. If you're looking to trade or invest in coins with competitive rates, exchanges like Binance, Bybit, and Bitget offer exciting opportunities with referral codes.