The Pepe (PEPE) price risks a correction in the wake of its 97% rally from the August lows.
PEPE came within a whisker of hitting $0.000012 on Sunday, a roughly 2x rally from the sub-$0.000006 August lows.
The PEPE rally broke a key short-term downtrend that has been in play since July and has seen its price burst sustainably back above its 50 and 200DMAs for the first time since May.
The impressive rally came as optimism about global central bank easing ramped up in the second half of September, lifting crypto assets across the board.
There is also an acceleration of upside momentum in meme coins. Pepe has some investors talking about the return of meme season.
The PEPE price rallied over 30% in three days from Thursday to Saturday last week.
But the Pepe price has now dropped nearly 10% from its weekend highs to below $0.000011.
Some fear this could start a bearish reversal, with signals suggesting Pepe has become overbought.
PEPE Price – Set For a Near-term Tumble?
The stunning rally in the Pepe price in the past few weeks has pushed its 14-day Relative Strength Index (RSI) firmly into overbought territory.
The RSI rose to 77 on Saturday, above the 70 threshold used to assess whether an asset is overbought.
It has since declined to just under 70. But in the last few months, jumps in the RSI have come ahead of Pepe price declines.
PEPE futures funding rates, meanwhile, have been elevated around 0.010% almost nonstop since mid-September, per CoinGlass.
A look at the PEPE funding rate over the last three months suggests that periods of time when the funding rate fluctuates between positive and negative are associated with local price lows.
Conversely, at times when the funding rate is consistently positive for a period of a week or more, this has been generally associated with local price tops.
That, combined with the overbought RSI signal, suggests that the Pepe price is at risk of correction.
Bears might target a near-term test of its late August high of just under $0.000010.
The 200DMA at $0.0000094 and the 50DMA at $0.0000080 might even come into play.
Buy the PEPE Price Dip?
But meme coin investors might want to consider buying any near-term PEPE price dip.
If US economic data this week (namely the ISM PMI reports and US jobs data on Friday) further eases fears that the US is headed for a recession in 2025, that could pave the way for a strong rebound.
The Fed is set on easing rates, which are high relative to inflation, to avoid its monetary policy becoming overly restrictive, regardless of whether the economy continues to perform well.
A situation where the Fed is easing interest rates but the US economy continues to perform well would be a perfect “goldilocks” situation for risk assets.
That could help Bitcoin and riskier cryptos like meme coins, including Pepe, perform very well in Q4.
A new meme season could be just around the corner and coming in time for Christmas.
Better Alternative to Consider – Pepe Unchained (PEPU)
A new meme season could see the PEPE price quickly surge as much as 3-4x before the end of the year.
That’s impressive, but some crypto degens will look for a much bigger upside potential.
Meme coin presales are a great way to get into high-potential projects early and at a low valuation.
PEPE investors might be particularly interested in an exciting new Pepe-inspired Ethereum layer-2 blockchain protocol called Pepe Unchained (PEPU).
PEPU has been making wakes in meme coin trading circles, with its presale now raising a whopping $16 million.
Analysts at Cryptonews.com rank Pepe Unchained as one of their best new meme coins and the best crypto presales to buy right now.
Cryptonews.com’s in-house presale analyst, Crypto Arjay, discusses in the video below why he thinks the Pepu Unchained blockchain will become a leading meme coin trading protocol.
Buy PEPU Here
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