Crypto Quill

The cryptocurrency market took a bearish turn during U.S. trading hours on Tuesday, with Bitcoin threatening to dip below $95,000. This downward momentum has weighed heavily on several major altcoins, including Pepe coin. The frog-themed memecoin now stands at a crucial juncture, where it could either stage a recovery or face a steep decline.

Pepe Coin Faces Key Support Amid Market Downturn

Pepe coin has been struggling under growing selling pressure, mirroring broader market trends. A major support trendline is currently acting as a buffer against further decline. However, if this support fails, PEPE could be in for a significant drop.

• The memecoin’s price has already fallen from $0.000021 to $0.00000962, a staggering 59% decline in just three weeks.
• The market capitalization has plunged to $4 billion, reflecting the fading bullish momentum.
• The price is now hovering near $0.00000875, showing signs of consolidation at a critical support level.

If buyers step in at this support level, PEPE could attempt a rebound. On the flip side, a breakdown below this level would open the door for another 30% slump, pushing the price towards $0.00000630.

PEPE Futures See Massive Drop in Open Interest

Futures data paints a concerning picture for Pepe coin. Open interest (OI) in PEPE futures has plummeted from $555.4 million to $250 million, marking a sharp 55% decline in recent weeks, according to CoinGlass.

• This drop in OI suggests that traders are closing leveraged positions, either voluntarily or through liquidations.
• Lower speculative interest often indicates market cooling and reduced trading activity.
• A decline of this magnitude signals weakening confidence among investors.

With traders backing off, the memecoin’s volatility could increase, making any potential recovery even more uncertain.

Death Cross Could Spell More Trouble

Technical indicators aren’t looking promising for PEPE. One of the most ominous signals on the charts is a potential “death cross,” where the 50-day exponential moving average (EMA) moves below the 200-day EMA.

• Historically, a death cross signals prolonged bearish momentum, often leading to deeper corrections.
• The price has already fallen below key daily EMAs (20, 50, 100, and 200), confirming the dominance of sellers.
• If this crossover materializes, it could accelerate PEPE’s decline, dragging the price even lower.

However, traders should also keep an eye on the ADX (Average Directional Index), which has surged to 34%. This suggests the current downtrend may be overextended, potentially triggering a short-term relief rally.

What’s Next for PEPE? A Bounce or Breakdown?

The coming days will be crucial for Pepe coin. If history repeats itself, a bounce from the support trendline could send the price back above $0.00001. Buyers might then attempt to test the downward-sloping trendline, aiming for a possible recovery toward $0.000027.

However, if PEPE fails to hold the support at $0.00000875, the sell-off could intensify. A breakdown would likely drive prices down by another 30%, bringing the memecoin to a low of $0.00000630.

For now, traders are watching closely. The market’s next move will determine whether Pepe coin can stage a comeback or if the decline is far from over.