Activity in the coin market gained momentum last week, leading to an uptick in demand for the frog-themed Pepe (PEPE) token.
By exchanging hands at $0.000012, the value of the memecoin has increased by 5% in the past seven days.
Baby sellers may take necessary action
Pepe (PEPE) Chaikin Money Flown (CMF) confirms high demand for altcoins. This indicator, evaluated on a one-day chart, is trending upward at 0.08 at the time of publication.
This indicator measures the flow of money into or out of an asset over a specific period of time. When its value is positive, it indicates that there is significant buying pressure behind the rising price of the asset.
However, PEPE’s Market Value to Realized Value (MVRV) ratio indicates a possible price reversal. At the time of publication, the value of the measure was 137.20%.
Read more: Baby: A comprehensive guide to what it is and how it works
The MVRV ratio evaluates whether an asset is overvalued or undervalued. This is done by comparing the current market value of the asset to the average price at which all units on the blockchain were last transferred.
When it returns a value higher than one, it indicates that the current market value of the asset is much higher than the price at which most investors acquired their holdings.
When the MVRV of an asset is higher than one, profit taking activity is common. This is because it indicates that the value of the asset has appreciated compared to the price at which it was acquired. Investors who hold above cost basis interpret this as an opportunity to lock in their profits by selling their holdings.
PEPE Price Prediction: Bulls are exercising control
Although it remains at risk of a significant sell-off, the bullish bias towards PEPE remains high. The Elder-Ray indicator for the meme coin confirms this. At the time of publication, the value of this indicator was above zero at 0.00000094.
This indicator measures the relationship between the power of buyers and sellers in the market. When its value is positive, the upward force is dominant in the market.
Furthermore, the growing open interest in PEPE shows an increase in demand for the meme coin. At $132 million at press time, PEPE’s open interest has risen 20% in the past seven days.
Open interest measures the total number of futures or options contracts outstanding that have not been settled or closed. When it rises, it signals an influx of traders to open new positions.
If the bullish bias towards PEPE continues, the price of the meme coin will rise to $0.000013.
However, if profit-taking activity begins, it will put downward pressure on the token price, invalidating the above predictions. PEPE price may then fall to $0.000012.
Disclaimer
In line with Trust Project guidelines, this price analysis article is intended for informational purposes only and should not be considered financial or investment advice. BeInCrypto is committed to providing accurate and unbiased reporting, but market conditions are subject to change without notice. Always do your own research and consult a professional before making any financial decisions. Please note that our Terms and Conditions, Privacy Policy and Disclaimer have been updated.