Meme coins created on Pump Fun or any other platforms can make you rich, but at the same time you can lose all your portfolio to rugs. Currently, the market is full of bundles, rug pulls, farmers, KOLs, etc., that want to take your money. I have experienced it all and lost a lot of money from all bad actors until I learned ways to recognize them and avoid them.
That is why I have created this guide so you do not basically donate your hard-earned money to them. Content is for education only and is not financial advice. Here I am talking about meme coins that are created using Pump Fun, Bonk, and other platforms where liquidity cannot be removed. I do not trade coins where dev can remove liquidity from coins; that is too risky.
I will give you examples and some obvious things that you can spot. But in order to become a good trader you have to practice and look at each coin to see what is happening. It is all about the practice. Even I, who is experienced, make a few mistakes.
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Bundles
First we will talk about bundles. Bundle is when one person has a lot of wallets inside a coin at low MC. When he sells, he can drop price more than 50%. There are a lot of ways to know if a coin is bundled or not, but sometimes you cannot. To recognize bundle just from chart you need experience.
When coin spawns on high MC: When you see coin just created but immediately has a few holders that own high % of coins, that means that dev sniped his coins. Unfortunately, this does not mean that coin will not do well. Maybe coin is good, so as soon as dev sells with his bundles, traders will get in and push the coins. But majority of them die.
If coin looks decent, then you can scroll down to transactions and look first transaction, amount of buys, did they sell, when did new bundles enter the coin, etc. For this you need experience.
If chart is growing without sells or small mount of sells, this means that they are slowly bundling it.
If volume is high but paid global fees are low, this means that someone is bundling it.
If coin is dead but suddenly starts going up slowly, there is high chance that bundles are getting in. So as soon enough people get in, they will just sell on bundles.
If chart has small buys but big sells, it is highly bundled.
Farmers, KOLs, Streamers
There are a lot of bad actors in meme coin space, but what they are doing is basically farming their followers and viewers. When you see big PNLs on X, most of them are farmers who will not be able to achieve that without copy traders and their followers. Even if they are extremely good traders, they will still farm you. That is the game and they are taking advantage. So my advice is not to copy trade and do not trust no one.
What they are doing is getting in coin with few wallets at low MC. They usually buy 9% of coins with main account and side wallets. Then copy traders get in, viewers or people from X which push the price even more. After that, normal traders enter in who think that coin is good.
So after all that they start selling from their side wallets, not from main, so copy traders do not sell. While they are selling from side wallets, they will continue to shill the coin. When they are completely out from side wallets, they will sell from main wallets. Sometimes they will simply sell it all immediately.
There are a lot of good coins after migration that start dumping hard. A lot of times reason is that KOLs and streamers started to sell all their bag that they have bought early. Then their copy traders start to sell, then whole panic starts, and normal traders start to sell which causes coin to go to 0.
Now imagine when there are 2 or 3 KOLs and streamers in coin. They are working together pushing coins so they can earn and farm the coin. Unfortunately, that is the game. That is why you have to track wallets to see if farmers are in the coin.
Usually you will recognize them by quick buying new pairs on low price and then selling as soon as it gets to 2x. Unfortunately, they are good traders, so they are most of time in good coins where you will have to buy on top of them. Usually, if I see 2 or more farmers that have a lot of copy traders and side wallets, I just skip the coin. Not taking a trade is a trade.
So make sure that you do research, find those wallets, track them, and learn how they are trading.
Final Take
Trading meme coins is extremely hard with all bad actors, but that is the game and you have to adapt. Sometimes you will have to enter the coin that is slightly bundled or has streamers and KOLs inside because narrative is good. If it is really good coin, it will not matter if they sell. Unfortunately, there is no magic button that will say will coin go up or down.
All you have to do is practice to learn to avoid bundles, to see what KOLs are holders and what are farmers, etc. Trading meme coins is a game where you can earn a lot, but you need to learn how to fight them; otherwise, you will lose all. Never copy trade; only time you can copy trade is if you found a really good wallet that is not public and that does not have copy traders.