Pepe memecoin was making a remarkable recovery from its local lows and was up 16% since the previous Monday, the 9th of March.
The bullish momentum was likely due to the market-wide shift in recent days, led by Bitcoin.
Moreover, the memecoin sector was not the strongest sector over the past week, but many of the popular coins saw sizeable gains in recent days.
Bitcoin [BTC] was able to stay above $70k over the weekend. Ethereum [ETH] bulls managed to pierce the $2,150 local resistance and were looking to drive the rally much higher.
This short-term impetus has been a boon to Pepe [PEPE] traders.
Pepe is yet to shrug off its long-term bearish structure
The swing structure on the 1-day chart was bearish. A set of Fibonacci retracement levels was plotted using this structure.
It showed that the current PEPE rally was only a retracement within a longer-term bearish trend.
At the time of writing, the memecoin was challenging the local supply zone at $0.0000036-$0.0000038. A lower timeframe rejection and another attempt at scaling the resistance is a possibility.
Over the coming days and weeks, expect PEPE to rally another 10%-25% to test the retracement levels plotted overhead.
The RSI managed to surface above the neutral 50 level, showing a potential trend shift. The OBV has also made a new high for March, underlining the buying volume behind the recent gains.
Short-term PEPE outlook – Buyers should not FOMO right now
The RSI was deep in overbought territory as PEPE approached the 23.6% extension level. This was a short-term bullish target based on the previous week’s price action.
Traders should be prepared for a retracement from this resistance level.
The retracement can go as deep as $0.0000034-$0.0000035, but it is unclear at the time of writing. Bitcoin showed strong momentum, which could help the bulls flip the local resistance to support and keep the rally going without a deeper pullback.
Traders can wait for further developments. Lower timeframe traders already in long positions can think of taking profits, and use a dip toward $0.0000035 to buy PEPE.
Final Summary
- Pepe exhibited strong bullish momentum over the past week, mirroring the sentiment behind BTC, ETH, and many other altcoins.
- The coming weeks could yield another 10%-25% move higher for the memecoin, which was constricted within a longer-term downtrend.
