PEPE Coin Price Action Looks Underwhelming, Struggles to Find Solid Ground Amidst Broader Market Downturn

Despite occasional spikes, the token's value remains suppressed, indicating waning investor confidence. Bearish on-chain signals accompany this decline

Pepe coin (PEPE) price action has been underwhelming of late, struggling to find solid ground amidst a broader market downturn. Despite occasional spikes, the token’s value remains largely suppressed—a trend that points towards waning investor confidence in the token.

This decline is being accompanied by some bearish on-chain signals, suggesting that PEPE’s short-term outlook may face additional downside pressure.

Pepe Coin Price Action: Exchange Balances Rise, MVRV Stays Neutral

As we take a closer look at PEPE’s recent market activity, one key observation is the increasing balance of the token on exchanges. This is usually taken as a sign of potential selling pressure.

When more tokens are being moved to exchanges, it heightens the possibility of a sell-off, which can create significant headwinds for any price recovery. This trend underscores the bearish sentiment surrounding the token, as investors appear to be more interested in offloading their holdings than in accumulating.

Another metric that has remained largely unremarkable is the Market Value to Realized Value (MVRV) ratio, which currently sits at a neutral level, offering little support for a bullish case. The MVRV ratio serves as an indicator of whether a token is over or undervalued.

At present, the ratio indicates that PEPE is not significantly undervalued, reducing the incentive for investors to buy in at current levels. Furthermore, the absence of strong undervaluation diminishes the possibility of a sudden rebound.

Adding to the bearish outlook, the Network Realized Profit/Loss indicator has shown consistent realized losses in recent weeks, with frequent dips into negative territory. This indicates that traders are, on average, selling PEPE at a loss, which is a strong indicator of fading market confidence in the token.

When combined with the rising exchange balances and neutral MVRV ratio, this persistent realization of losses paints a bearish picture for PEPE in the short term.

PEPE Technical Setup Forms Bearish Descending Triangle

Meanwhile, the PEPE USD pair has formed a bearish technical setup called the ‘descending triangle.’

This technical formation is recognized by analysts as a bearish continuation pattern. The configuration features a declining upper trendline that compresses price action into lower highs, while a flat lower trendline serves as consistent but weakening support.

The pattern signals intensifying selling pressure, resulting in progressively weaker rallies that struggle to breach resistance. In this setup, traders estimate the potential downside by measuring the maximum height of the triangle.

Pepe coin’s price recently broke out of this descending triangle, only for bulls to push it back within the pattern. However, if the Pepe coin price confirms the bearish setup, the PEPE/USD pair could plummet by over 62%, reaching a target near $0.000003024.

A breakout below the pattern in the current market climate could be catastrophic for PEPE prices, potentially resulting in significant losses for the trading pair. Moreover, if the Pepe coin rally fails, the bulls will likely attempt to consolidate above the pattern’s support level to mount a defense.

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