PEPE drops 12% as $2.84M reward selling hits – What next?

Pepe [$PEPE] has lost 12% of its market cap in the past 24 hours as memecoins plunged by more than 5%. However, $PEPE’s weekly gains remain in the green, up about 27%, hinting this drop could be just a short correction.

Among the top 100 cryptos by market cap, $PEPE was the worst-performing memecoin. Other memecoins that recorded double-digit losses in a single day were BONK, USELESS, and CASHCAT.

$PEPE’s loss was driven by selling pressure and the coin’s technical phase.

$PEPE rewards on StonkFun induce selling pressure

$PEPE coins were being sold for profits after a 10-day surge. These tokens were emanating from the StonkFun [STONK] reward system, where holders of FEELSGOOD had received $2.84 million in $PEPE tokens.

As a result, its Open Interest (OI) fell from $400 million to $334 million. Moreover, the trading volume declined from $1.32 billion to about $727 million, reinforcing the decrease in buying activity, as per CoinGlass data.

This launchpad’s system has also rewarded other tokens like Bitcoin [BTC], Solana [SOL], and Hyperliquid [HYPE], among others.

Additionally, $PEPE was in a pullback phase, with the price retesting its previous higher high (HH) around $0.0000040. This uptrend was initiated by a breakout from an inverted head-and-shoulders pattern.

The pullback phase is evident as the MACD bars are slowly fading in color. This indicates a decline in bullish strength. If that continues, the memecoin could plunge to $0.0000030.

However, long liquidations, which had risen sharply, have since cooled off, implying the correction might be nearing an end. If the level holds, its next target is at $0.0000050 or higher.

Inside $PEPE vs. $PENGU price action fractal!

Meanwhile, Ali Martinez is anticipating an explosive rally for Pudgy Penguins [$PENGU] as its structure is starting to ape that of $PEPE.

Before its 2024 rally, $PEPE had an early expansion, correction, accumulation, and eventual breakout. Basically, the memecoin’s price rallied from $0.0000009 to $0.000009, which is more than a 10x increase.

Currently, $PENGU is entering a part of the cycle where the largest expansion happened, making it difficult to ignore the fractal. If the fractal plays out, $PENGU could surge from $0.0087 to $0.80, equivalent to almost a 100x pump.

However, this fractal hinges on the whole crypto market staying bullish at least extending into the next quarter.

Final Summary

• $PEPE plunged by more than 12% in the past 24 hours, as users sold $2.84 million in $PEPE rewards on StonkFun.
• $PENGU appears to be entering the part of the cycle where $PEPE began its explosive rally.