Santiment warns that a sudden surge in trading volume for meme tokens such as SHIB, PEPE, FLOKI, and BONK could mean a price reversal is imminent.

While Bitcoin ( BTC ) and meme coins including Shiba Inu Coin ( SHIB ), Dogecoin ( DOGE ), and PepeCoin ( PEPE ) have experienced a strong run of recent gains, some investors have begun to take profits sell off.

While meme tokens have been boosted by the broader market rally and are expected to rise further, Santiment cautioned investors to remain cautious with meme tokens.

Surge in trading volume: potential red flag
Santiment notes that some meme tokens have seen significant growth in trading volume recently, especially in the last week.

Meme tokens such as SHIB, PEPE, FLOKI, and BONK have seen trading volumes increase by over 3,000% on average over the last week, which could mean a price pullback is imminent.

Santiment believes that the sudden increase in trading volume indicates that prices have increased and that community interest in these meme tokens is increasing.

Be wary of rising volatility and price reversals

Santiment believes that the sudden increase in trading volume, coupled with the rise in social volume, may be an important indicator of increased volatility and potential price reversal in the coming days.

Here’s Santiment’s warning:
Meme tokens, especially those that have performed strongly over the past week, have seen rapid increases in trading volume due to rising prices and increased interest.

On average, SHIB, PEPE, FLOKI, and BONK saw volume growth of over 3,000% last week.

When trading and social volume suddenly increases, it can be an indicator of large swings and price reversals for the asset.