Three Reasons Why PEPE Could Grow 30%

• Pepe’s price broke and closed above the downtrend line on Thursday, looking for a rally.
• On-chain data indicates a bullish move as PEPE’s dormant wallets are active and the long-short ratio is above one.
• A daily candlestick close below $0.0000069 would invalidate the bullish thesis.

Pepe (PEPE) is extending the upward move on Friday after breaking the downtrend line and resistance barrier on Thursday. Latent PEPE wallets are on the move and the long-short ratio is above one, further supporting this bullish move and suggesting a rally on the horizon.

Pepe price shows the potential for a rally

Pepe price broke above the downtrend line (drawn by joining several highs from late July to mid-September) and closed above the daily resistance level of $0.0000078 on Thursday. At the time of writing on Friday, it continues to trade higher at around $0.0000083.

If PEPE price establishes support near the trendline trigger level, with previous daily resistance around $0.0000078 acting as support, it could rally 30% to hold its Fibonacci retracement level of 61, 8% to $0.0000104 (drawn from July high to August low).

The MACD (Moving Average Convergence Divergence) indicator further supports the PEPE rally, signaling a bullish crossover on the daily chart. The MACD line (blue line) has moved above the signal line (yellow line), giving a buy signal. Additionally, the Relative Strength Index (RSI) is trading above its neutral level of 50 and leaning higher, indicating strong bullish momentum.

PEPE/USDT daily chart

PEPE’s on-chain data further supports the bullish thesis. Coinglass’ long-short ratio is 1.08, a one-month high. This indicates that more traders are betting on the asset’s price to rise.

Long ratio PEPE chart

Furthermore, the Sentiment Age Consumed index aligns with the optimistic outlook. Spikes in this index suggest that dormant tokens (tokens stored in wallets for a long time) are on the move and can be used to identify short-term local tops or bottoms.

For PEPE, history shows that these peaks have been followed by an increase in Pepe’s price. The most recent rise on September 10 also forecast that PEPE is poised for an uptrend.

Chart of the consumed age index PEPE

However, if Pepe’s daily candlestick closes below $0.0000069, it would form a lower low on the daily time frame, thus invalidating the bullish thesis. This development would reduce Pepe’s price by 13% to retest daily support at $0.0000060.