Pepe price forms death cross as smart money investors flee

Pepe price forms death cross as smart money investors flee

Pepe coin has experienced a significant crash, plummeting 65% from its all-time high and showing further signs of potential downside. The price recently dropped below a key support level at $0.000011 and is now hovering near its lowest point since November 7 of last year.

Nansen data reveals a sharp decline in smart money investor activity, with the number of investors holding Pepe dropping to 68, down from a peak of 91 last year. Additionally, the amount of Pepe tokens held by these investors has decreased from 12.32 trillion in February 2024 to 9.52 trillion.

Pepe’s poor performance mirrors that of other Ethereum-based meme coins like Shiba Inu, Floki, and Dogelon Mars, which have all seen significant drops. Investors are now increasingly focusing on Solana-based meme coins, such as Fartcoin, Official Trump, and Dogwifhat.

This downward trend is further evidenced by a notable drop in futures open interest. The open interest fell to $282 million on Tuesday, down from a year-to-date high of $556 million, signaling a decrease in demand for the coin.

Technical indicators suggest that Pepe is nearing the formation of a death cross, a bearish pattern where the 50-day and 200-day Weighted Moving Averages converge. A death cross typically signals a lack of demand and could lead to further declines in price. Additionally, Pepe has dipped below the lower boundary of its descending channel, which adds to the negative outlook. The Average Directional Index has risen to 27, indicating that the downtrend is gaining strength, and the Relative Strength Index is approaching oversold territory.

If this trend continues, the next potential support level for Pepe is at $0.0000059, which would represent a 45% drop from the current price.

On a more optimistic note, Pepe is also forming a falling wedge pattern, which suggests a possible future rebound. The wedge pattern will remain valid as long as the price stays within the descending trendlines.