PEPE Price Forms Bullish Setup at Support — Wave Count Hints at Breakout
Will PEPE Break Out | Credit: Getty Images
Key Takeaways
- PEPE has decreased inside a descending wedge since May.
- The price has created a bullish pattern inside support.
- Will PEPE finally break out from its long-term pattern?
PEPE was one of the best-performing meme coins in 2024, leading the Solana blockchain and outpacing older meme coins in Ethereum, such as Dogecoin (DOGE) and Shiba Inu (SHIB).
While the positive momentum has dissipated since May, the PEPE price still trades over 450% above its yearly open. Moreover, the price action since August shows two higher lows, which could be the first step in creating a bullish structure.
Let’s examine the PEPE price action and determine what’s in store for the rest of 2024.
PEPE Price Sees Bullish Signals
The PEPE price has decreased inside a descending wedge pattern since the all-time high of $0.0000172 on May 26. The decrease led to a low of $0.0000058 on Aug. 5, validating the wedge’s support trend line. The same day, PEPE created a long lower wick, bouncing and creating a higher low on Sept. 6.
Besides confirming the wedge, the two lows validated the $0.0000065 horizontal support area and created a double bottom (white icons) pattern.
So, the PEPE price action shows two bullish patterns created inside a long-term horizontal support area.
These signs point to an impending breakout from the wedge. Additionally, there is a growing bullish divergence (green) in the Relative Strength Index (RSI) and MACD indicators, developing since Aug. 5. So, the divergence has encompassed the entire double bottom, making an eventual breakout even more likely.
If one occurs, the price of PEPE can reach the 0.5-0.618 Fibonacci retracement resistance levels at $0.0000115 – $0.0000129.
Short-Lived Rally
Similarly to the price action and indicator readings, the wave count gives a bullish PEPE price prediction. However, it also suggests that the ensuing breakout will simply be a relief rally that does not lead to a new all-time high.
Starting in September 2023, the meme coin completed a five-wave increase and began a correction afterward.
While there is a completed A-B-C structure that ended on Aug. 5, it is too short to have corrected the entire increase.
The decline is less the 0.382 times the upward movement, making it unlikely to be the entire correction. So, it is possibly wave A in a larger A-B-C correction.
Therefore, the proposed breakout from the daily time frame could be just wave B in the longer-term count. Another decline could follow, marking wave C.
In any case, both the wave count and price action predict an initial PEPE price breakout. The reaction once the price gets to the 0.5-0.618 Fibonacci retracement resistance will help determine if the increase is wave B or a new upward movement.
Ending 2024 on a Bullish Note
The daily time frame analysis for PEPE is extremely bullish, showing multiple bullish patterns and positive readings from technical indicators. A breakout from the wedge pattern will confirm the beginning of an upward movement.
However, the long-term chart implies the breakout will be only a relief rally and the price of PEPE will eventually decline after creating a lower high.
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