Fartcoin [FARTCOIN] dropped over 12% in the last 24 hours as the broader crypto market declined by 4%.
The memecoin sector slipped 2%, even as trading volume rose 31%.
However, a few memecoins were doing well, especially those with the AI narrative. Despite FARTCOIN having such a narrative, it lacked real-world utility.
Hence, why was the memecoin down, and can bulls step in to reverse this?
Four-month support cracks
On the charts, FARTCOIN has been in a sideways market since the 10th of October market crash. The crash saw the memecoin create a low at $0.0933 but has not revisited the level.
Bulls created a support level at $0.2145 and were defending it each time the price approached. Consequently, they would push the price toward the $0.4664 zone.
However, the situation changed in February, as the price fell below the 4-month support level. Bears overpowered bulls, breaking below the $0.2145 level, which confirmed bear trend continuation with a retest.
Source: FARTCOIN/USDT on TradingView
In fact, the bull’s strength had faded completely, as seen in the MACD bars.
However, they reacted very aggressively when the price hit $0.0933 previously. This area could hold for a rebound.
Otherwise, the memecoin would continue crashing.
Derivative positioning reinforced the weakness.
The Long/Short Accounts metric showed 54.25% of accounts positioned short, versus 45.75% long. That imbalance confirmed bearish dominance.
Having said that, leverage clusters added further pressure.
Leveraged short orders accelerate FARTCOIN’s decline
Apart from a weak structural outlook, leverage also played a key role in FARTCOIN’s price decline.
The analysis of cumulative long and short liquidation leverage showed bear dominance. On all exchanges, the shorts accounted for about $4 million, which was more than 4x that of the longs at $802K.
Most of the shorts were added around $0.17 to $0.18, where 50X leverage orders topped, followed by those of 25X. Also, the current price levels around $0.15 showed that more of the 50X leverage orders were being added.
Source: CoinGlass
The data showed most of the leverage was on the Hyperliquid [HYPE] exchange.
Cumulative Short Liquidation Leverage was $58.28 million, as per CoinGlass. The result meant about 65.09K FARTCOIN had been shorted, which was about 3X those that had been bought.
FARTCOIN holders lose confidence
Additionally, on-chain data showed that holders were losing confidence in the memecoin.
In fact, holders declined from a high of 160.95K to 160.86K, where it has remained this February. The lack of growth showed that traders had no interest in the memecoin.
Source: CoinMarketCap
This meant that the anticipated reversal at $0.0933 could follow the drain if such a situation continues. Therefore, FARTCOIN remains bearish until a market structure break occurs.
Final Summary
- FARTCOIN lost a four-month support level after falling 12% in 24 hours.
- Leveraged short positioning and flat holder growth reinforced bearish pressure.
