MEW Surges 22% to Two-Month High, Market Cap Rises 18%

Cat in a Dogs World [MEW] experienced a significant surge, rising by 22% to reach a two-month high of $0.004 before retracing to $0.0039 by press time. This rally marked a breakout from a multi-month downtrend, with the memecoin hitting $0.00406 before slightly retracing.

During this period, the market capitalization of MEW increased to $349 million, representing an 18% rise. Typically, when volume and market cap rise, it signals growing on-chain activity and capital inflow. However, the question remains whether this is a speculative bubble or the start of a sustained uptrend.

Investors rushed into the market to bet on MEW’s next move, leading to a 57% jump in Open Interest to $48.36 million and a 695% surge in Derivatives Volume to $358 million. This reflects growing participation in futures. As a result, MEW’s Funding Rate surged to 0.0046, indicating a higher demand for long positions. Longs soared to reach 63.8% while shorts accounted for 38% of the total futures accounts, implying that most investors are aggressively betting on prices to rise.

As MEW surged, so did the appetite for investors who have been underwater to cash out. According to CoinGlass, MEW recorded two days of consecutive positive Exchange Netflow. At press time, Netflow was around $1.57 million, a $500k increase from the previous day. Typically, when Exchange Netflow turns positive, it suggests that investors are selling more than they are buying. Additionally, the same pattern emerged when examining the Aggregated Spot Buy Sell Volume.

On the 16th of July, buyers dominated the market, scooping up 13.09 million tokens. This buying pressure pushed the memecoin for a breakout. However, on the 17th of July, power dynamics shifted drastically, and sellers outpaced buyers. As such, Sell Volume spiked to 31.36 million compared to 23.94 million Buy Volume. As a result, the market recorded a negative Sell-Buy Delta of 7.42 million tokens, indicating aggressive selling.

According to AMBCrypto’s analysis, MEW saw a strong upswing as investors rushed into the market to take futures positions. As a result, the memecoin’s Stochastic RSI 92 is reaching overbought territory. At the same time, Directional Movement Index (DMI) surged to 52, signaling strong upward momentum. When momentum indicators rise, it suggests the current trend is strong, and it’s likely to continue.

That said, for the uptrend to continue, buyers need to reclaim the narrative and displace sellers. In doing so, buying pressure will boost MEW to reclaim $0.004 and target $0.448. However, the sell-side risk is more dominant than ever. If profit takers continue at the current pace, downward pressure will intensify, and MEW will drop to $0.0033.