Pepe (PEPE) tried to break through a local resistance last week, but failed and was pushed back. Since May 15, the value has fallen 20%, although the longer-term trend remains bullish.
Prices will probably rise again. But when and where will this bullish reversal occur? On the other hand, since most holders have profits, a wave of profit taking could bring PEPE back to April lows.
Technical indicators remained bullish despite the decline
PEPE reached a local peak of $0.0000108 but failed to close a daily session above this level. This was the same resistance as in March that once again held the bulls back. Still, there were some factors in the bulls’ favor.
The OBV trended upward and remained above two key short-term levels. This indicated that selling pressure had not yet prevailed and that further gains were possible. The market structure on the 1-day chart also remained bullish.
The RSI fell from 72 to 56 over the course of a week as prices fell, but momentum on the daily timeframe remained positive for buyers.
As a result, despite the recent decline, PEPE is likely to rise towards the 23.6% Fibonacci extension level of $0.0000131.
The short-term support levels at $0.0000087 and $0.0000078 could be the possible reversal points. If Bitcoin (BTC) starts to weaken and falls back from $67k, it is possible that PEPE will retreat deeper.
Sentiment has been weak lately
Since May 15, when PEPE reached local peaks and was rejected, Open Interest has decreased. The price has also fallen further. The Funding Rate remained at +0.01%, with occasional dips indicating an increase in short positions.
The liquidations over the past 48 hours came from bullish traders. These forced selling increased bearish pressure. However, it was not as volatile as on the 15th, when both larger sized long and short positions were liquidated.
Therefore, the local bottom could be close and a period of consolidation could follow. Traders can pay attention to this and keep an eye on the short-term charts for a possible rebound.
Source: https://cryptobenelux.com/2024/05/20/pepe-daalt-met-20-echter-blijft-de-trend-bullish/
