PEPE Bulls Inject $37 Million – Is the Memecoin’s Momentum Fading?

Despite a significant $37 million influx from bullish investors, questions arise about whether PEPE’s recent rally is beginning to lose strength. Market analysts are closely monitoring the memecoin’s performance for signs of sustained momentum or potential exhaustion as trading volumes and social sentiment fluctuate. The current market dynamics suggest cautious optimism, with technical indicators hinting at possible consolidation after the recent surge in price action.

PEPE forms a bullish ascending pattern

On the 4-hour chart, PEPE was trading within a bullish ascending triangle pattern, characterized by a horizontal resistance level and an ascending support line converging.

Typically, when prices oscillate within this structure, a breakout to the upside often follows, breaching the resistance line.

A close look at the chart below reveals that each time PEPE approaches this resistance level, it produces prominent wicks rather than full-bodied candlesticks.

This behavior suggests strong selling pressure at the resistance level, which could trigger a pullback.

But that’s not all. Additional metrics also point to increasing downward pressure.

Source: TradingView

Moreover, the formation of a death cross — where the 20-day SMA slipped below the 200-day SMA — adds to bearish sentiment.

At the time of writing, the 20-day SMA crossed below the 200-day SMA, pushing the price toward the pattern’s support level.

The Accumulation/Distribution (A/D) indicator also confirms this bearish trend, showing that the market has entered a distributive phase. In this phase, participants begin selling the asset, causing it to trend lower.

Source: TradingView

Momentum wanes as volume drops despite price uptick

On top of that, volume dynamics showed fatigue.

While PEPE ROSE 1.49% in the last 24 hours, trading volume fell by 36.4%. This Price-Volume divergence typically suggests a weak rally with fading follow-through.

Derivative traders could further contribute to PEPE’s decline.

The Funding Rate, which indicates which segment of the market is more dominant, has turned negative at -0.0097. This shows that short sellers are in control, paying a periodic fee to maintain their positions.

Source: CoinGlass

Spot traders are accumulating

Despite the broader selling pressure, spot traders have continued to accumulate the memecoin. In the past week alone, they bought $37 million worth of the asset.

This figure is significant because the last major accumulation occurred on the 3rd of March, when $53 million worth of PEPE was moved to private wallets.

Source: CoinGlass

Given the bearish sentiment, this recent accumulation appears to be a strategic move by traders looking to capitalize on lower prices. 

Overall, spot trader activity could slow the memecoin’s decline as they continue accumulating during the dip.