The meme coin sensation, Pepe (PEPE), is facing a potential downturn as mounting evidence suggests a significant sell-off could be imminent. The cryptocurrency, which has seen meteoric rises since its inception, is now grappling with a bearish outlook triggered by a confluence of factors.
On-chain data is painting a grim picture for PEPE holders. A colossal whale has recently moved a staggering 395.92 billion PEPE tokens, worth approximately $3.4 million, to Binance. This significant transfer follows a previous deposit of 400 billion tokens, fueling speculation about a potential exit strategy.
To exacerbate the situation, PEPE’s Exchange Flow Balance has surged, indicating a sharp increase in tokens flowing into exchanges. This metric is often interpreted as a bearish signal, suggesting that investors may be looking to liquidate their holdings.
Technically, PEPE’s price has already reacted to the bearish pressure, retesting the critical support level of $0.0000089. If this level breaks, analysts predict a potential plunge of up to 32%, with the next support zone lying at $0.0000060. Corroborating this bearish sentiment, both the Relative Strength Index (RSI) and Awesome Oscillator (AO) are currently positioned below their neutral levels, reinforcing the downward trend.
The IntoTheBlock In/Out of the Money Map (IOMAP) reveals a substantial number of investors who bought PEPE around the $0.000008 level. If the price retraces to this point, these holders could be incentivized to sell, adding further downward pressure.
While the outlook appears bleak, a silver lining exists for PEPE bulls. A daily candlestick close above $0.0000130 would invalidate the bearish thesis and potentially ignite a rally towards the next resistance level at $0.0000157. However, given the current market dynamics, this scenario seems less likely.
As the cryptocurrency market remains highly volatile, investors are advised to exercise caution and conduct thorough research before making any investment decisions. The potential for significant price fluctuations in meme coins like PEPE underscores the inherent risks associated with this asset class.
