The reason why PEPE could collapse in the coming days

• PEPE price is retesting the retracement of the uptrend line at $0.0000089 with an imminent decline on the horizon.
• Lookonchain shows that a whale deposited 395.92 billion PEPE tokens worth $3.4 million on Binance.
• PEPE’s exchange flow balance shows positive growth, signaling a downward price movement.
• A daily candlestick close above $0.0000130 would invalidate the bearish thesis.

Pepe (PEPE) retested the breakout level of its uptrend line on Friday, leading to a 9% decline over the next two days. Chain data indicates a positive increase in the balance of exchange flow, suggesting a downward price movement in the near term.

Additionally, Lookonchain data reveals that a whale deposited the remaining 395.92 billion PEPE tokens valued at $3.4 million on Friday, following a previous deposit of 400 billion PEPE tokens worth $4.22 million of dollars on August 1, which further reinforces the bearish outlook.

PEPE price could fall further on failed trendline pullback retest

Pepe retested the breakout level of the uptrend line at $0.0000089, which had previously acted as support, on Friday. It fell 9% over the next two days. On Monday, it is trading slightly higher by 1.5% at $0.0000078.

If the $0.0000089 level holds as resistance, PEPE could crash 32% and retest the daily support at $0.0000060.

The Relative Strength Index (RSI) indicator and the Awesome Oscillator (AO) on the daily chart are trading below the neutral levels of 50 and zero. These momentum indicators strongly point to bearish dominance.

PEPE/USDT daily chart

On-chain data also points to a bearish outlook for the PEPE price. According to IntoTheBlock’s In/Out of the Money Map (IOMAP), approximately 4,230 addresses bought 12.87 trillion PEPE tokens at an average price of $0.000008. If the price rises to this level, this significant amount of investors may opt to sell in order to break even on their positions.

From a technical analysis perspective, the $0.000008 resistance level aligns with the IOMAP findings, marking this area as a crucial reversal point to monitor.

PEPE IOMAP chart

Santiment’s exchange flow balance for PEPE shows the net movement of tokens in and out of exchange wallets. A positive value indicates more PEPE tokens coming in than exchanges going out, suggesting selling pressure from investors. Conversely, a negative value indicates more PEPE left the market than entered, indicating less selling pressure from investors.

In the case of PEPE, the exchange flow balance increased from -299.91 billion to 773.91 billion between August 8 and August 9. This positive growth generally suggests increased selling activity among investors.

PEPE exchange flow equilibrium diagram

Even though chain metrics and technical analysis indicate a bearish outlook, if Pepe’s price produces a daily candle close above $0.0000131, the July 24 daily high, the move would invalidate the bearish thesis by making a higher high in the range of daily time. . This development could send PEPE price up 20% to the next resistance level at the June 1 high of $0.0000157.