You might consider a coin is overvalued when You can see the process on how the coin price is increased. When the price is increased significantly in a short time, but the market volume is just steady, it might be just a price manipulation. The volume should increase just as much as the price or even more.
this statement is somehow true.
In my own understanding, people started to doubt for an altcoin to be an overpriced is when they don't believe a crypto project and it's supply and demand.
although trading volume could be a suspect but the moment the dev team are pushing their best to promote their crypto project to public then that will ignite the pump as people were trying to set on board before the coin price value will surge.