The Recent Exit of a Major Pepe Whale Sparks Market Uncertainty
A prominent investor in Pepe [PEPE] has decided to sell off a significant amount of 552.92 billion PEPE tokens for $6.92 million in USD Coin [USDC], contributing to the prevailing market unease.
Previously, this whale had traded 1.48 trillion PEPE, securing a profit of $3.42 million. However, such substantial liquidations often lead to increased volatility and negative sentiment in the market.
Currently, Pepe is valued at $0.00001274, experiencing a 1.07% decline for the day and struggling to maintain crucial support levels. With heightened selling pressure on the memecoin, the question arises: can the market absorb this recent development, or are further declines on the horizon?
A Significant Drop in PEPE Market Capitalization by Nearly $7 Billion
Pepe has witnessed a staggering decrease, with its market capitalization plummeting by $7 billion over the past 40 days. A few months back, the coin was valued at $12 billion, but it has since fallen to $5.24 billion, indicating a waning investor trust.
This sharp decline has raised concerns regarding Pepe’s long-term viability. Nevertheless, some traders view the current price levels as an opportune moment for accumulation before a potential upswing in altcoin and memecoin markets.
Current Price Trends Show Bearish Sentiment Amid Oversold Conditions
The breakdown of Pepe below a descending wedge pattern has intensified selling pressure, made worse by breaching the $0.00001687 demand zone and weakening its overall structure.
Furthermore, the Williams Alligator indicator confirms a bearish signal, as the blue, red, and green moving averages are trending downwards at $0.00001625, $0.00001516, and $0.00001416, respectively.
Despite this, the RSI stands at 34.32, hinting at oversold conditions that could prompt a short-term bounce. If buyers enter the market, a temporary recovery might ensue.
Weakening Pepe Fundamentals Revealed by On-Chain Data
On-chain metrics continue to show predominantly bearish signals, reflecting a network that is facing challenges. With net network growth at 1.69% (bearish) and “In the Money” metric at -3.43% (bearish), it indicates a slow adoption rate and more holders in loss positions.
Although whale concentration remains low at 0.71% (bearish), suggesting reduced accumulation, the rise in large transactions by 2.50% (bullish) implies sustained institutional involvement despite the price downturn.
MVRV Long/Short Difference Points to Limited Upside Potential
The MVRV long/short difference has declined to 10.45%, marking one of its lowest values in months. This decrease indicates a reluctance among traders to hold Pepe for extended durations, heightening the risk of short-term sell-offs.
Further declines in profitability could trigger more liquidation events. However, a stabilization of MVRV may signal a potential price reversal in the near future. Pepe’s next moves will depend on the balance between demand and selling pressure in the market.
Exploring the Possibility of a Recovery for Pepe
The current market outlook for Pepe remains predominantly bearish due to ongoing whale sell-offs, weak fundamentals, and a decreasing market capitalization pushing the coin lower.
Despite this, RSI levels suggest a potential short-term relief rally if buyers defend the current price levels. A reclaim of the $0.00001687 zone could lead to stabilization and a subsequent recovery for Pepe. Conversely, further downward movement is anticipated before any significant upturn occurs.