Bearish Trend and Potential Rally for Pepe Coin
Pepe Coin (PEPE) is facing a significant downturn, with its price dropping 39% to $0.00001048 amid a recent bearish trend. Despite this, the formation of a bull flag pattern suggests a potential rally could be on the horizon.
Market Dynamics and Recent Performance
On Wednesday, during Asian trading hours, the crypto market experienced a surge in selling pressure, with Bitcoin (BTC) dropping nearly 4%. This decline in BTC, which revisited the $60,000 level, sparked concerns of a continued downtrend in major altcoins, including PEPE. The frog-themed memecoin fell by 8% today, extending its correction within a channel setup. Investors are now questioning whether they should stay invested.
The current correction in Pepe Coin began at the end of May, with the price reversing from $0.00001725. Since then, PEPE has been on a steady downtrend, characterized by lower highs and lows resonating with two downsloping trendlines. This bearish trend has led to a 39% decline, bringing the asset down to $0.00001048 and reducing its market cap to $4.42 billion.
Bull Flag Pattern and Long-Term Outlook
An analysis of the daily chart reveals that the falling trendline has formed a bull flag pattern, which typically indicates a temporary counter-trend move that allows buyers to regain strength. Despite the correction, PEPE's price remains above the 50% Fibonacci retracement level, indicating a long-term bullish trend and suggesting that buyers still dominate this asset.
Whale Activity and Market Sentiment
However, the recent sell-off by a major whale, identified as dimethyltryptamine.eth, has raised concerns about a potential breakdown below $0.00001. This whale, who had been inactive for 10 months, recently sold 10 billion PEPE tokens (worth $112,000) for 32.73 ETH. This early investment turned $45,000 into $26.7 million, reflecting a 58.6% gain. Currently, the whale holds 1.99 trillion PEPE tokens valued at $21.9 million. The whale's recent sell-off suggests a lack of confidence in a strong short-term upside for PEPE.
Technical Indicators and Future Projections
To reverse the current correction trend, PEPE needs to break out from the flag pattern resistance. Sustained buying could drive the post-breakout rally past $0.0000135 and potentially retest the $0.00001725 peak.
Bollinger Bands (BB) Indicator: The downtick in the lower Bollinger Band highlights aggressive selling, with no signs of reversal yet.
Average Directional Index (ADX): An uptick in the daily ADX slope to 20% indicates that sellers are gaining momentum, which could lead to a prolonged downturn.
Conclusion
Pepe Coin is currently in a precarious position, facing significant bearish pressure and recent whale sell-offs. While the formation of a bull flag pattern suggests the possibility of a rally, a breakout from the current resistance is essential for a reversal. Investors should closely monitor technical indicators and market sentiment to gauge the potential for a sustained recovery.
Notice:
,,The information and views presented in this article are intended solely for educational purposes and should not be taken as investment advice in any situation. The content of these pages should not be regarded as financial, investment, or any other form of advice. We caution that investing in cryptocurrencies can be risky and may lead to financial losses.“