Earlier in May, the market capitalization of Pepecoin (PEPE) — a cryptocurrency inspired by the popular internet meme Pepe the Frog — had soared to $1.8 billion. Two weeks later, the PEPE market cap has come crashing down to roughly $665 million, a 65% decline. Let’s look at the reasons why.
Pepe mania winners dump
PEPE whales appear to have been primarily responsible for the price drop, according to data tracked by Wuligy, an on-chain analyst at Dune Analytics.
Notably, the top fifteen addresses with the highest earnings and returns, and those holding a significant amount of PEPE tokens around its market peak have dumped most of their holdings in recent weeks.
Some whales have even sold 100% of their PEPE reserves during the crash, as shown below.
Simultaneously, PEPE’s hourly transactions and volumes have dropped substantially compared with their peaks on May 5, indicating declining trading activity among whales and fish alike.
On a brighter note, PEPE’s daily holder count has flatlined, if not fallen, since April’s sharp increase from around 100 to over 100,000. As of May 23, it was over 115,000, suggesting that new users are joining despite the price decline.
However, some of these addresses may belong to existing PEPE holders or represent exchange wallets, given PEPE’s listing across multiple crypto exchanges since its launch, the latest being Bitfinex.
If you’re a fan of memecoins, then don’t miss out on $PEPE – the crypto created in tribute of Pepe the Frog
Deposits are now open at Bitfinex, find out when you can start trading!https://t.co/GMDLOcsvcX pic.twitter.com/6Kb0YiaAhf
— Bitfinex (@bitfinex) May 22, 2023
PEPE price bounce next?
PEPE price is now at a technical support confluence level, suggesting that a modest bounce is now in play.
The confluence comprises an ascending trendline, a 50-4H exponential moving average (50-4H EMA; the red wave), and a Fibonacci retracement line near $0.00000146.
A rebound attempt from the said support raises PEPE’s potential of rising toward $0.00000190, up 20% from current price levels.
Conversely, a decisive close below the support confluence would position PEPE/USD price for a decline to $0.00000083 by June, down 45% from current price levels.
This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.