Pepe [PEPE] rallied by 26.9% in the last 24 hours, with a daily trading volume surge of 300%. It was a strong performance towards the end of the week. And, a quiet weekend without a sizeable retracement would be perfect for PEPE bulls.
Whether they will get this remains to be seen though. The hike in trading volume for PEPE was not a consistent trend, but only accompanied the gains made over the previous day.
Bitcoin [BTC] crept back toward the $90k-resistance, where it had faced rejection the previous week. Traders should not expect Bitcoin to break above this key resistance anytime soon and bolster the altcoin market sentiment.
Challenging the overhead supply zone
Source: PEPE/USDT on TradingView
PEPE challenged the 1-day timeframe’s supply zone at the $0.0000044-$0.0000049. The bulls were victorious in this skirmish and seemed to be on the verge of forcing a bullish structure shift.
The OBV, which had been on a steady downtrend in recent weeks, was slowly climbing higher too. This ascent was not explosive though, and does not guarantee a resounding bullish outcome for the memecoin.
The RSI signaled a bullish momentum shift with a reading of 67. A daily trading session close above $0.000005 would shift the structure bullishly, giving swing traders a reason to go long.
Exploring the bullish breakout
In a recent report, AMBCrypto had illustrated that $0.0000042 was a pivotal short-term resistance zone. PEPE bulls achieved a breakout above this local resistance on Monday, 29 December, but it failed to defend their gains.
Another attempt on Thursday, 01 January, had more success. At the time of writing, PEPE had a strong short-term bullish bias.
Traders’ call to action – Divergence could see a minor pullback
Source: PEPE/USDT on TradingView
The 1-hour chart displayed a bearish momentum divergence in recent trading hours. This suggested a price dip was close by, but not guaranteed. In case of a pullback, the $0.000046-$0.0000049 region could give a buying opportunity.
This buying opportunity depends on what happens on Friday. Friday’s trading session close would be key for swing traders to watch. A breach of the $0.000005 swing high would mean they can look to go long, targeting the $0.0000062-resistance next.
Failure to close the day’s trading above the swing high would be a shorting opportunity as it would represent a failed breakout and a warning of subsequent bearish strength.
Final Thoughts
- The popular memecoin PEPE shrugged off its stupor and has been making rapid gains in recent hours.
- Demand must be sustained over the coming days to keep the rally going past the swing high from earlier in December.
Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion
