PEPE on a slippery slope, potentially testing $0.0000048 support level

PEPE, the meme coin that has captured the attention of many in the cryptocurrency market, is currently navigating a challenging phase.

The latest data shows that the meme coin has dropped by a whopping 25%, amid a broader crypto market drop that has seen the likes of Bitcoin (BTC) and Ethereum (ETH) test multi-month lows. Bitcoin, for instance, has tested a low of $49, with the market sentiment remaining bearish.

PEPE closed below a critical ascending trendline

Recent analysis indicates that PEPE closed below its critical ascending trendline on Saturday, leading to a significant 6% decline over the subsequent day.

By press time on Monday, the coin had plummeted 19% to $0.0000066. It had a slight rebound after testing its daily support level at $0.0000060. The price action has raised concerns among investors.

If PEPE fails to maintain this support and closes below $0.0000060, it could experience a further drop, potentially retesting the next support level at $0.0000048.

Momentum indicators like as the Relative Strength Index (RSI) and the Awesome Oscillator signal a continuation of the downward trend.

Further, the MACD has also fallen below the neutral zero, and the Chaikin Money Flow (CMF) is only marginally negative, underscoring a bearish bias on the daily chart.

On the flip side, if PEPE manages to rise above the $0.000013 mark, it could reverse the current market structure. Such a move would represent a higher high on the daily timeframe, potentially driving a 15% rally to revisit the June 1 high of $0.000015.

However, the prevailing trend appears bearish, with the liquidation data from Coinalyze and holdings distribution indicating a high likelihood of another 20% drop in August.

Recent data also shows that whales have been distributing their holdings, contributing to increased selling pressure.

The distribution among smaller holders, however, remains limited, further reinforcing the bearish outlook.

PEPE struggled to hold its fair value gap as a support zone

The price action and on-chain data reveal that PEPE struggled to hold its fair value gap as a support zone. The coin crashed through this level, reaching local lows at $0.000008.

This level previously acted as a bounce point after early July losses, the meme coin has dropped past it fast approaching the other support level at $0.0000060. While there is hope for a rebound, the current market conditions suggest otherwise.

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