Short-sellers experienced significant success during the recent market fluctuations, leveraging the downward momentum of Bitcoin [BTC] to generate profits. The scenario was no different for PEPE, with investors who entered the market at $0.000010 witnessing a 15% increase in gains.
But can shorting PEPE yield further profits prior to the announcement of the U.S election results?
PEPE Nearing Critical October Support Level
As of the latest data, PEPE’s value had dropped by 15%, placing it in the vicinity of its critical October support level. A breach below this level might encourage more bearish activity, potentially leading to additional profits for short-sellers.
If the October support is breached, there is a possibility that PEPE could decline to $0.0000080 or even further down to the support level at $0.0000070 (cyan). This would result in short-sellers gaining up to 30% if the price hits the latter target.
Considering the potential market volatility post the U.S election, it is advisable to secure partial profits in advance.
Despite the bearish indications from the below-average RSI reading and the tepid OBV, a sudden reversal in Bitcoin’s performance could invalidate the shorting strategy. In such a scenario, achieving the 50-day EMA and the trendline resistance as bullish targets during a recovery phase becomes crucial.
Decline in PEPE’s Active Addresses
Moreover, there has been a notable decrease in active addresses associated with PEPE since late October, signaling a reduced level of market engagement and interest in the digital asset. This decline further supports the bearish outlook, particularly in the period leading up to the U.S election outcome announcement.
Additionally, the PEPE long/short ratio indicates that approximately 58% of positions are currently leaning towards a net short position on the memecoin. This sentiment reinforces the bearish sentiment and serves as an additional incentive for short positions.
From a broader perspective, the prevailing market turbulence presents lucrative opportunities for short-sellers, including those involved with PEPE. However, these opportunities are contingent on market stabilization following the announcement of the U.S election results.
For potential investors interested in holding PEPE, strategically acquiring the asset at discounted rates during periods of market uncertainty could prove advantageous in the medium to long term, especially if there is a strong market recovery post the elections.