Pepe [PEPE], along with other memecoins, experienced a significant drop as major investors (whales) shifted their funds to different sectors.
Recent data from Spot On Chain indicates that a whale has sold off a portion of their PEPE holdings, totaling 130B (almost $3M), to invest in alternative altcoins within the last three days.
This has led to a decline of over 20% in PEPE from its all-time high (ATH) of $0.00002957. The question remains, how far might this decline extend before a substantial recovery?
Potential for PEPE Coin Recovery
At present, the 12-hour chart for PEPE displays a bearish market structure with a descending channel. The price momentum appears weak, as indicated by the oversold Stochastic RSI reading.
Short sellers could potentially profit if the price reaches the lower channel or the 50% Fib level. Nevertheless, the price drop may be limited to the golden ratio at the 61.8% Fib level ($0.000014).
Despite this, the RSI remains above the 50 mark, implying that demand, though flat currently, remains robust. Should more speculators embrace the ‘buy the dip’ strategy, a recovery in price is probable.
If enthusiasm reignites the uptrend, particularly amidst a surge in BTC above $100K, the trendline resistance target (white) could be attainable.
Weakening Sell Pressure on Centralized Exchanges
Despite the challenges, PEPE appears poised for a potential turnaround. Data from Santiment reveals that sell pressure on centralized exchanges (CEXes) is less pronounced compared to the peak witnessed in March.
In March, the PEPE supply on CEXes reached nearly 230T, but the current supply stands at 171T. This reduction in supply could pave the way for a PEPE recovery.
There has been an uptick in ‘buy the dip’ accumulation, evidenced by the rise in supply outside of exchanges (red) during price declines.
Historically, these indicators are viewed as bullish signs and could signal an impending price reversal for the meme coin inspired by the frog.
Disclaimer: The insights provided do not constitute financial advice, investment guidance, trading recommendations, or any similar counsel and represent the writer’s perspective alone.