The Rollercoaster Ride of PEPE in April: From Fearful Sells to a 33% Recovery
PEPE experienced a significant drop, losing nearly 50% of its value in just five days, failing to defend the $0.00000581 support level. The most substantial losses occurred between the 11th and 13th of April, creating a wave of panic among traders.
While the sudden volatility may have caught many off guard, it also presented an opportunity. Within a mere 32 hours from its low point on the 13th of April, PEPE managed to bounce back by 33%, sparking speculations on whether the local bottom has been established. Let’s explore what the future trajectory might entail.
Indications of Accumulation
Starting from mid-March, this memecoin has been retracing its gains from late February. Despite the apparent downtrend on the price chart, the average coin age has been steadily increasing, hinting at a continuous accumulation of PEPE across the network.
This accumulation theory is further supported by the age consumed metric, revealing significant spikes on the 4th of April, along with two notable ones on the 26th and 27th of March. While these spikes indicate substantial token movements, they lack the consistency witnessed earlier in March.
Although panic-selling resulted in some holders parting ways with their assets, a significant number continued to hodl through the losses. The negative 30-day MVRV, indicating growing losses, coupled with the rising mean coin age, signaled a potential buying opportunity.
Despite recent market fluctuations, the 7-day weighted sentiment remained positive, defying expectations. Yet, technical analysis still hinted at the possibility of further downward movement.
Market Dynamics and Potential Support Levels
Following the retracement to $0.00000581 on the 19th of March, PEPE established a new swing low. The recent downturn indicated a bearish trend in the short term, reflected in the market structure. However, the 12-hour chart suggested a bullish bias despite a prevailing RSI of 33 indicating downward momentum.
With the OBV dropping below a crucial support level after a month, additional losses were anticipated in April, potentially leading PEPE to test the 78.6% retracement level at $0.00000318.
Analysis of the liquidation heatmap revealed scarce liquidation levels above the current market prices, while $0.00000245 emerged as the next significant support level to the downside. However, a potential turnaround in Bitcoin could trigger an upward bounce for PEPE.
In the short term, the $0.00000955 zone represented a magnetic price level. The significant margin of 85% above current prices raised doubts amidst the prevailing market uncertainties.
Overall, the data indicated a short-term buying opportunity for traders interested in PEPE amidst its turbulent journey.