Pepe (PEPE), the meme coin that has captured the attention of the cryptocurrency community, is currently experiencing a downward trend. This follows a rejection from the significant $0.000013 resistance zone, raising concerns among investors about its short-term trajectory. A recent report has further complicated the outlook for PEPE, revealing that a whale transferred a staggering 400 million PEPE tokens—equivalent to $4.22 million—onto Binance. Such a large influx of tokens to an exchange often signals an intention to sell, amplifying bearish sentiment surrounding the coin.
Despite the current bearish trend, there are aspects of PEPE’s technical setup that could offer a glimmer of hope for bulls. Notably, the coin has been trading within a critical support zone. This area, which was established following a substantial 52% price gain in mid-July, represents a potential rescue point for trapped bulls. The recent price action left behind a noticeable fair value gap on the daily chart, marked in white, which could act as a support level.
In early July, PEPE experienced a bearish market structure break, with a lower high formed on June 26 that has not been breached since. This decline was followed by a drop in the daily Relative Strength Index (RSI) below the neutral 50 mark, indicating a strong bearish momentum. However, the Chaikin Money Flow (CMF) remains well above +0.05, suggesting that significant buying pressure could still support a price reversal.
Furthermore, the potential for a short squeeze adds another layer of complexity to PEPE’s price prediction. The cumulative liquidation levels indicate that short positions are currently far outnumbering long positions. This imbalance could drive a price surge as traders rush to cover their shorts. The $0.000011 and $0.0000115 levels are notable targets where substantial liquidation could occur, potentially leading to a temporary price rebound.
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In conclusion, while PEPE is facing downward pressure, the combination of a fair value gap and a possible short squeeze could offer opportunities for both recovery and strategic trading. Investors should remain vigilant, considering both the bearish indicators and potential for a price bounce in the coming days. Swing traders, in particular, might find value in leveraging short-term price movements within the broader bearish trend.
In addition to these technical indicators, market sentiment and external factors could play crucial roles in shaping PEPE’s near-term future. The recent whale movement has understandably sparked anxiety among retail investors, who often react strongly to large-scale transactions.
However, it’s worth noting that meme coins like PEPE are notoriously volatile and can experience sharp price swings based on community-driven hype or broader crypto market trends. As the coin hovers near its key support levels, any positive news or renewed interest could trigger a swift recovery, underscoring the unpredictable nature of meme coins in the cryptocurrency market.
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.
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