On May 18th, Pepe (PEPE) experienced a significant downturn, marked by a steep decline in its price. Analysis of its metrics provided insights into the potential reasons behind this bearish movement. According to data from CoinMarketCap, the price of PEPE began a sharp descent in the recent hours, leading to a decline of over 6% in its daily price.
As of the latest update, the meme coin was trading at $0.000009426, boasting a market capitalization exceeding $3.9 billion, positioning it as the 27th largest cryptocurrency. Further examination of IntoTheBlock's data suggested a probable cause for this decline. It revealed that more than 92% of PEPE investors were currently in profit, potentially prompting them to sell their holdings and consequently exerting downward pressure on the meme coin's price.
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How Pepe's Exchange Activity Reflects Recent Trends
Upon analyzing Santiment's data, AMBCrypto observed several notable trends regarding Pepe's exchange activity. Throughout the previous week, the meme coin experienced multiple spikes in exchange inflow, indicating increased movement of tokens onto trading platforms. Particularly noteworthy was the observation that following a period of decline, Pepe's supply on exchanges began to rise.
Source: Santiment
Concurrently, its supply outside of exchanges showed a decrease on May 18th, suggesting a sell-off of tokens. Additionally, after a notable surge on May 14th, the supply of the meme coin held by top addresses slightly decreased. This implies that some prominent holders, possibly including whales, divested their holdings, potentially contributing to the downturn in Pepe's price.
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Pepe's Bearish Trend Deepens
The bearish sentiment surrounding Pepe intensified further as various metrics signaled a downturn for the meme coin. Over the past week, Pepe's Social Volume experienced a significant decline, indicative of waning interest and reduced chatter surrounding the coin within social media circles.
Additionally, its Weighted Sentiment also exhibited a downward trend in recent days, reflecting a negative sentiment among investors and suggesting an anticipation of further price declines. Furthermore, market indicators reinforced the bearish outlook, with Pepe's Relative Strength Index (RSI) showing a decline.
Source: Santiment
Currently, the RSI stands at 58.7, indicating a weakening momentum in the market and potentially signaling further downside for the meme coin.
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Similarly, the Chaikin Money Flow (CMF) displayed a decline, suggesting a high probability of the ongoing bearish trend persisting. Upon analysis, it was observed that Pepe's price remained notably above its 20-day Exponential Moving Average (EMA).
Source: AMBcrypto on TradingView
Consequently, should the downward trajectory persist, there's a possibility that the meme coin's value could decline towards its 20-day EMA, potentially serving as a support level.
See more: Cryptocurrency Prices and Market Cap
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