Presently, PEPE [PEPE] is experiencing a robust recovery, posting a nearly 10% increase to reach a trading price of $0.0000249.
Similar uptrends are observed across most memecoins with the collective market capitalization surpassing $138 million after an 8% surge within a 24-hour period.
PEPE has emerged as one of the standout performers in the cryptocurrency market this month, hitting a new all-time peak of $0.000028 on December 9th.
Despite a subsequent 9% decline, several indicators suggest a healthy correction underway.
PEPE MVRV Points to Possible Turnaround
In the last 24 hours, PEPE’s market value to realized value (MVRV) ratio has decreased from 1.96 to 1.74, signaling a dip in unrealized profits.
This decline in the MVRV ratio implies that investors are opting to retain their PEPE holdings rather than selling.
The falling MVRV ratio for PEPE indicates that the memecoin is not yet deemed overvalued despite recent price gains, leaving room for further upward movement.
Even though 94% of PEPE holders are currently in profit, as per IntoTheBlock data, the MVRV ratio remains within reasonable levels, showcasing a bullish sentiment among traders.
Potential for Continued Bullish Momentum
PEPE has formed an ascending triangle pattern on its four-hour chart, typically suggestive of a bullish continuation.
However, a successful bullish breakout above the key resistance level of $0.0000254 will heavily rely on buying interest in the market.
The Relative Strength Index (RSI) currently stands at 53, indicating subdued bullish momentum, with the RSI line remaining flat, suggesting indecision among buyers.
A similar outlook is observed with the on-balance volume (OBV) indicator, which has flattened following a sharp uptrend earlier in the week.
PEPE’s ability to break out of the ascending triangle pattern and sustain its upward trend hinges on the entry of new buyers into the market.
If PEPE successfully breaches the resistance at $0.0000254 with strong buying activity, it could trigger further price gains.
However, any weakening in the uptrend and profit-taking pressure leading to a drop below the support level of $0.0000223 could signal a potential bearish reversal.
Decline in PEPE’s Funding Rate
Data from Coinglass indicates a significant decrease in PEPE’s Funding Rate, falling from a record high to 0.0144%.
Despite bulls still paying fees to maintain their positions, the reduction in the number of long positions signals a shift in market sentiment.
A reduction in derivatives market activity could result in lower volatility, creating an environment conducive for PEPE’s growth potential. However, prolonged declines in Funding Rates, turning negative, may introduce a bearish sentiment.
Could PEPE Hit a New ATH in 2024?
PEPE is currently less than 10% away from its all-time high. With barely three weeks remaining in the year, the memecoin is demonstrating promising signs, aided by reduced leverage for a healthier recovery.
A breakthrough above the $0.0000254 resistance level, as per the upper trendline of the ascending triangle, could propel PEPE towards new highs before the year concludes. Yet, intensified profit-taking might lead to a downturn.