The recent performance of the two leading meme coins PEPE and FLOKI makes me feel it’s necessary to sound a warning to everyone.

Let’s start with the phenomenon—last week, FLOKI surged 40% following PEPE’s lead. Many investors saw an opportunity and quickly shifted their positions from PEPE to FLOKI. But what happened next? A quick scan with the TD Sequential indicator showed a clear sell signal turning red. These two leading coins repeatedly flashing risk signals behind the scenes reveal a problem that’s not so simple.

I’ve been using the TD Sequential tool for many years. While it can’t guarantee 100% accuracy, on highly volatile meme coins, its hit rate can stay above 65%. The principle is straightforward—if nine consecutive candles close at new highs, it indicates that the upward momentum is nearly exhausted, and a reversal could be imminent. The key issue with FLOKI this time is divergence between price and volume. The price is rising, but the trading volume can’t keep up—essentially a fake rally.

Some might say, the overall market cap of meme coins jumped from 38 billion to 47.7 billion, an increase of nearly 23%, with trading volume tripling. How can it be cooling off? Those numbers look impressive, but we need to consider the context—meme coins overall fell 65% in 2025 to reach the bottom. This current rebound, to put it bluntly, is just a “recovery after overselling,” not the start of a new bull market.

Comparing this to mainstream cryptocurrencies makes it even clearer. Bitcoin remains steady around $90,000, and Ethereum holds at $3,100. There’s no sign of large-scale capital flowing into meme coins; instead, investors are choosing between mainstream assets and meme coins. If you’re still fully invested in meme coins at this point, your risk awareness might be a bit concerning.