Behind optimism lie threats

The price increase of $FLOKI is accompanied by a significant increase in open interest in the derivatives market. Over the past two days, open interest has grown by 87% from $40 million to $75 million. This indicates a growing hype and interest among investors in the meme coin. The sharp rise in this metric reflects an intensified fear of missing out (FOMO). Traders are eager to extract potential profits.

The positive funding rate confirms this trend, indicating the dominance of long positions. This is a clear sign of investor optimism and expectations that FLOKI will continue to rise.

However, the situation surrounding the token is not so straightforward. The MVRV metric (market value to realized value ratio) currently stands at 32.62%. This indicates that investors who bought FLOKI last month are sitting on a 32% profit.

On one hand, this indicates a positive sentiment in the market. However, past instances when MVRV reached this level often led to reversals, as investors tend to sell when profits are high. The range of 19%–32% for MVRV is considered a “danger zone.” Many traders are locking in profits, and this could trigger a price correction. $PENGU $PEPE