Will PEPE explode after 37 million USD flows into the market?

Although PEPE is showing positive signals with a bullish pattern suggesting the potential for further upward movement, many other market indicators are providing conflicting signals, making the growth outlook less certain.

Bitcoin Magazine has conducted an in-depth analysis of the factors that may hinder the potential recovery of PEPE, while also assessing the drivers that could support the bullish trend in the near future.

PEPE forms a bullish triangle pattern

On the 4-hour timeframe, PEPE is moving within a bullish triangle pattern – a technical structure that often signals a potential breakout, with a horizontal resistance line above and an upward-sloping support line below converging.

In most cases, this pattern usually leads to a breakout in a bullish direction, when the price breaks through the resistance zone. However, the recent price chart reveals a different story.

Specifically, each time PEPE approaches the resistance level, the price prints long wicks instead of solid candles - a signal indicating that strong selling pressure is present in this area. This raises concerns about the possibility of a short-term bearish adjustment.

Source: TradingViewNot stopping there, other technical signals are also reinforcing the negative scenario. Notably, the appearance of the "death cross" pattern, when the (SMA) 20-period moving average crosses below the (SMA) 200-period moving average - a signal often associated with a bearish trend.

At the time of writing, the 20-period SMA has officially fallen below the 200-period SMA, pulling the price of PEPE back close to the support line of the triangle pattern.

In addition, the Accumulation/Distribution indicator (A/D) also shows clear signs of a distribution phase – when money is leaving the market, reflecting investors' profit-taking or capital withdrawal mentality, thus creating downward pressure on prices.

Source: TradingView## Weak momentum as trading volume declines despite price bullish

In addition, the change in trading volume also clearly reflects signs of weakening momentum.

Although PEPE has recorded a bullish increase of 1.49% in the past 24 hours, the trading volume has sharply decreased by 36.4%. This divergence between price and volume often indicates a recovery that lacks strength and sustainable momentum.

Moreover, derivatives traders may also be contributing to pushing the price of PEPE down.

Funding Rate – an indicator showing which side has the upper hand in the market – has now turned negative, at -0.0097. This indicates that the bears (Short) are in control and are willing to pay periodic fees to maintain their position.

Source: CoinGlass## Spot traders are accumulating