PEPE is Pumping, This Trader Thinks It Means a Market Pullback is Imminent
Meme Coin Rise Equals Crash?
Ran Neuner, founder of Cryptobanter, has taken to X to let his followers know his thoughts about the current state of the altcoin market. His comment suggests he views the recent surge in PEPE as a potential indicator of an imminent market pullback within 72 hours, implying such pumps may signal over-speculation.
While PEPE has gained 99% in the past month, it should be noted that during that time it had several short-lived spikes on top of the sustained gains. Recently, PEPE has spiked at least two times in the past 24 hours.
Will PEPE Continue to Fly?
Pepe Coin (PEPE) quickly became a notable meme cryptocurrency in 2023, reaching over US$ 1 billion (AU$ 1.57 billion) in market cap just weeks after its launch. Based on the popular Pepe the Frog meme, it aims to rival established meme coins such as SHIB and DOGE despite having no practical application. PEPE has a total supply of 420 trillion tokens, with the majority in liquidity pools and a small portion reserved for future use.
It features a deflationary system where transactions burn tokens, potentially increasing value. Nevertheless, it lacks intrinsic value and is subject to market volatility. Its performance, still uncertain, will depend on the market’s reception over time. However, it has seen solid gains over the year, something not all meme coins have been able to pull off.
Overall Market Sentiment
As the market moves in cycles and Bitcoin (BTC) dominates, once the number one has made its gains, money flows first into Ethereum (ETH) and then into bigger altcoins like Solana (SOL), Cardano (ADA) and Chainlink (LINK). Following this, money often flows into smaller coins and eventually meme coins. It’s important to note that while this pattern has been observed, it is not a rule and does not necessarily occur in every market cycle. The crypto market is still highly volatile and speculative and can be influenced by a myriad of factors including technological developments, regulatory news, macroeconomic trends, and market sentiment.
Anyone watching the market right now as well as observing the social media reactions to it, would appreciate that statement. As some are starting to short altcoins, others are just starting to pour more money into the market in hope of a continued rally.
Trader Michaël van de Poppe notes that Bitcoin faced strong resistance, leading to a rejection instead of a breakout. With this in mind, his advice is to engage in trading altcoins, which he expects to be an enjoyable activity.