The open interest in futures contracts for the dog-themed memecoin Floki Inu (FLOKI) has surged to its highest level in the past 30 days. Coinglass data reveals that it currently stands at $19 million, marking a significant 111% increase since the start of May.
The term “Futures open interest” refers to the total number of futures contracts that have been initiated but not yet settled or closed. A notable increase in open interest suggests a growing number of market participants establishing new positions in the market.
FLOKI’s increasing “demand”
FLOKI’s chart value was $0.0002123 at the time of publication. According to CoinMarketCap, it has risen by about 20% over the past seven days, making it one of the top gainers on the market.
The daily trading volume of the token increased in tandem with the aforementioned increases. Santiment reports that on May 15, FLOKI’s daily trading volume reached a record high of $1.06 billion, the biggest since March 28.
FLOKI’s primary momentum indicators were above their corresponding neutral lines, indicating a surge in demand. At the time of publication, FLOKI’s Money Flow Index (MFI) yielded a value of 65.37, while its Relative Strength Index (RSI) was trending upward at 62.68.
Despite the recent surge in FLOKI’s value and its attempts to break through the upper boundary of its ascending channel, bears maintain considerable influence in the market.
This observation stems from the analysis of the token’s Chaikin Money Flow (CMF), which has consistently remained in negative territory during the mentioned period. The CMF is an indicator that tracks the flow of money into or out of an asset.
When the CMF declines while the price of the asset increases, it creates a negative divergence. This divergence suggests that buying pressure in the market is weakening despite the asset’s price appreciation. Consequently, it implies that the recent price rally may have been fueled more by short-term speculation rather than robust fundamentals or sustained investor interest.
As of the latest data, FLOKI’s CMF stands at -0.11, indicating a negative flow of money into the token.
Additionally, FLOKI’s daily funding rate across various crypto-exchanges has shown a mixed trend, alternating between positive and negative values since the start of May. This variability suggests that the price of FLOKI’s perpetual swap contracts has been fluctuating around its spot price, which typically reflects market indecision regarding the asset’s future price direction.
May 2024, Cryptoniteuae
