Pepe Plunges 40% as Double Buy Signal Emerges From Oversold Territory
Market Pulse
- A monthly loss of 40.4% was recorded for PAID Network’s PEPE token.
- This monthly candle is actually the largest red candle in PEPE’s history, so far.
- Developer Kyle Kistner announced the PEPE token is quickly becoming one of the most liquid markets in DeFi which has also been observed in the nearly 19 million token volume outlier on June 1st and 3rd.
The price of Pepe has been on a downward spiral over the past month, losing 40.4% to last exchange hands at $0.000004273, as heightened global risk aversion weighed on cryptos as a class and paused meme coins’ stoic advance. The decline was exacerbated over the week, with the Ponzi coin giving up another 12.2%. With one bottom battered, an interim low established at the November 12 low, it’s possible that the capitulation phase has finally run its course. The buying panic and climactic selling volume suggests a “panic low” could be in place.
| Metric | Value |
|---|---|
| Asset | PEPE (PEPE) |
| Current Price | $0.00 |
| Weekly Performance | -12.15% |
| Monthly Performance | -40.45% |
| RSI (Relative Strength Index) | 28.9 |
| ADX (Average Directional Index) | 53.2 |
| MACD (MACD Level) | 0.00 |
| CCI (Commodity Channel Index, 20-period) | -96.97 |
RSI at 28.91 Matches Levels Last Seen Before Previous 200% Surge
The Relative Strength Index (RSI) registers 28.91 on the daily chart, which appears to be the most oversold reading since the August washout before a 200% rally ensued. The TD Sequential’s double buy signal indicates that potential trend exhaustion matched the RSI indicator of momentum exhaustion.
What really stands out is how RSI was unresponsive during the decline, grinding lower without any relief bounces. This is indicative of true capitulation, not a normal, controlled pullback. Given that swing traders look for that condition, and they now have it along with the double buy signal, this is the highest probability long we’ve had since the summer.
ADX Climbs to 53.22 – Mature Downtrend Nearing Exhaustion Point
When the market detects that a move could be exaggerated, the price action usually does things that “shake the trees” and make life difficult for traders. Low volume rallies or selloffs are a common tactic as the market doesn’t feel it’s necessary to lure in buyers or sellers given the current sell/buy imbalance. You’d chalk it up to how markets work, but keep in mind that it’s easier than ever for Algos to push paper-thin markets around. They’ll also pounce on size resting in stops if the move is perceived as inappropriately influenced by humans. Remember, when algo’s have control, common sense and reliability go out the window.
Importantly, one of these ADX readings has arrived that is at an extreme level. Converging nicely with an area highlighted on a recent chart, that regularly proceeds to end a downtrend when consolidating into an apex. So, prepare for increased day-to-day range soon. The downtrend has stretched itself so much to the downside now, that literally anything could send it higher in search of 0.618.
20-Day EMA at $0.0000051 Becomes First Major Resistance Target
When we pair this with the fact that the 200-day EMA is currently chugging along at $0.0000114, PEPE comes to face the harsh reality of a 65% surge necessary to reclaim this long-term indicator.
Buyers also face risk if the broader market downturn accelerates, in which case an eventual technical target based on the potential double-top formation would loom at $0.0000036 into the end of the year. This would create a fundamental incentive for large washout long liquidity and continue to pose substantial risk ahead of this level.
Resistance Stacks Between $0.0000047 and $0.0000053 Define Recovery Path
Sellers situated further above will likely defend $0.0000056, which marks the level the price must breach to form a daily swing high. Beyond that, sellers remain present at $0.0000061, $0.0000071, and $0.000008.
Buyers are currently testing the resistance at the 26-EMA. The 4-hour timeframe has not had a single 4-hour candle straight closing above since June 15 which holds the highest probability of leading to confirmation of a bull trend in the short-term. The bulls are also trying to confirm the first 4/8 stochastic crossover since March 24. If confirmed, it will signal more upward movement.
From a technical standpoint, the market structure indicates a falling wedge pattern nearing the apex. The $0.0000043 support combined with a series of lower highs creates this ‘coiling spring’ formation as we like to call it and historically on PEPE, these patterns resolve in very aggressive moves of over 50% within the first week of breaking out.
Bulls Need Decisive Close Above $0.0000047 to Ignite 109% Target
If the price reclaims and holds above $0.0000047 on a daily closing basis, the technical pattern will be confirmed as the double-barrel buy signal. It would also push bulls to take the squeeze up to the 20-day EMA for $0.0000051. To print the 109% measured move target ($0.0000089), wedge resistances will require a daily closing to be crossed over.
If the cryptocurrency fails to defend $0.0000043, it will confirm a head and shoulders top on the four-hour chart that could extend a bearish slide towards the March 16 low at $0.000004. The 200 four-hour Simple Moving Average (SMA) at $0.000004 also reinforces this level as strong support. Strong offers are expected to emerge there, as Q1 2024 volume point of control (VPOC) is located roughly at $0.000004.
Due to the extreme oversold conditions, rare double buy signal, and waning exchange selling pressure, the likeliest short-term path is PEPE continues to consolidate between $0.0000043-$0.0000047 before making an oversold relief rally to $0.0000051. Technical exhaustion signals coinciding with on-chain fundamentals strengthening makes the longside compelling from here.
