- The popular memecoin PEPE has been experiencing significant price fluctuations recently.
- After a promising surge, the token faced a critical resistance level, leading to a dramatic price drop.
- Details from on-chain metrics and liquidation data suggest continued bearish trends for PEPE.
Recent price movements in PEPE have raised concerns among investors as the token faces persistent bearish pressure, influencing its short-term outlook.
Rejection at Key Resistance Level
PEPE showed strong bullish momentum earlier, rallying by 17.80% over three days. However, the upward trend encountered a significant obstacle at the $0.00000920 resistance. The failure to surpass this level triggered a sharp decline of 9.17% within just 48 hours, reversing recent gains and steering the token into a bearish trajectory.
On-chain Metrics Indicate Bearish Outlook
Analysis of on-chain metrics painted a pessimistic picture for PEPE. The Net Network Growth metric revealed a bearish trend at -1.08%. Additionally, the proportion of investors “in the money” dropped by -0.50%. Concentration levels showed a slight bearish shift at -0.07%, and large transactions followed suit with a bearish signal of 0.57%. These indicators collectively suggest that PEPE is likely to experience continued downward pressure in the near future.
Increased Liquidations on Derivatives Exchanges
The recent price drop in PEPE led to a spike in liquidations on derivatives exchanges. According to Coinglass data, there have been numerous forced closures of leveraged long positions over the past 24 hours. This increase in liquidations is indicative of overly optimistic investors who assumed significant risks. Should the price persist in its decline, it could trigger additional sell-offs.
Cooling Market Sentiment
Another concerning factor for PEPE is the cooling sentiment among its holders. Data from Santiment showed a notable decrease in network activity, with active addresses dropping sharply in recent weeks. This decline in engagement and interest makes a recovery challenging, especially without new buying pressure to counteract the bearish trend. The path of least resistance appears to be downward, given the current market sentiment.
Conclusion
With the combination of technical rejections at resistance levels, bearish on-chain metrics, rising liquidation volumes, and declining market sentiment, PEPE faces considerable challenges ahead. The immediate focus should be on the $0.00000720 support level. If this fails to hold, the token might revisit lows around $0.00000650. To shift towards a bullish outlook, PEPE must reclaim and maintain the $0.00000920 resistance level. Investors should exercise caution and closely monitor these critical levels.
