Pepe Coin Plummets 40%, But the Frog Coin May Rally Back Stronger
Pepe Coin continues to face a bear market, having seen a significant decline from its peak in May.
Pepe (PEPE), the second-largest meme coin on the Ethereum (ETH) network, has dropped to $0.000010—down 40% from its May high. Here are the top three factors that could lead to a recovery soon.
Pepe Coin Price Forms a Falling Wedge
The main reason for the potential revival of the Pepe token is the emergence of a falling wedge, a notable bullish reversal pattern. This pattern comprises two descending and converging trendlines that are nearing their confluence. A falling wedge is considered one of the most bullish formations in technical analysis.
Moreover, the price of Pepe has consistently stayed above the ascending trendline connecting its lowest swings since March. It is also above the crucial support level indicated by the Murrey Math Lines at $0.000005960.
Consequently, the token appears ready for a substantial bullish breakout, with a key target to watch at $0.00001625—indicating a potential increase of over 70% from the current price. Conversely, a fall below the weak stop-and-reverse level at $0.000007450 would invalidate this bullish outlook.
Significant Volume and Open Interest
The persistent demand and popularity of Pepe are evident. Per CoinGecko, its 24-hour trading volume exceeded $400 million on Sunday, July 6. Although this is lower than previous peaks, it still significantly surpasses the trading volumes of other well-known meme coins; for instance, Shiba Inu (SHIB) had a 24-hour volume of less than $70 million.
According to data from CoinGlass, Pepe’s futures open interest has remained consistent over the past few weeks, showing a 24-hour open interest of $522 million—considerably higher than the year-to-date low of $173 million. Elevated open interest often signals bullish sentiment for an asset, indicating increased demand.
Declining Exchange Balances for Pepe
Additional data suggests that investors are retaining their Pepe Coins despite recent losses. According to Santiment, the stock of Pepe on exchanges has dropped to a multi-year low of 101.7 trillion tokens, down from a year-to-date high of 158.9 trillion.
The decrease in exchange supply, along with an uptick in whale accumulation, indicates that the token may be primed for a rebound soon. Nansen reports that the number of Pepe tokens held by whales has increased by 4.1% over the past 30 days, reaching 7.6 trillion.