The frog-themed memecoin, Pepe, showcased an insignificant loss of 0.4% during Friday’s U.S. market hours, trading at $0.0000123. Along with a short downtick, the daily candle showcased a massive price rejection from $0.000013, signaling a slowdown in recovery momentum. However, a sharp bounce in the derivative market’s open interest for PEPE means the traders are expecting a strong move in this asset.,
Derivatives Market Data Hints a Potential Move Ahead
Since last week, the Pepe coin price has shown a strong recovery from a $0.00000951 floor to a recent high of $0.0000137, registering a 39.5% growth. This upswing followed broader market momentum as investors showed their optimism towards the upcoming crypto week that could clear three major crypto bills in the House of Representatives.
Along with price recovery, the PEPE futures open interest also recorded a sharp bounce from $487 million to $654.8 million, a swing high that accounts for a 35% surge. Typically, the increasing OI data indicate insignificant inflow into the derivative market as traders expect a massive move in the near future.
However, the OI data do not conform to a particular direction in price but mostly to a dynamic move in the market.
Thus, the funding rate metric aligns well with the OI data to determine the price trend. Currently, the PEPE OI-weighted funding rate stands at 0.0135%, indicating that the buyers are paying a premium to sellers to hold their position on the long side.
Pepe Coin Price Eyes 30% Surge Amid Cup and Handle Formation
The daily chart analysis of Pepe coin shows the current recovery faces overhead supply at $0.000013. A long-wick reflection candle from $0.0000132 accentuates the surge in selling pressure after the recent market recovery.
This rejection from a known resistance hints at a higher possibility of a bearish reversal. However, this pullback could benefit crypto buyers to recuperate the exhausted bullish momentum.
The $0.000015 level stands as a suitable support for buyers to resume their prevailing recovery.
Furthermore, the PEPE price shows the potential formation of a cup and handle pattern. This chart setup is commonly spotted at major market bottoms and bolsters crypto buyers with a long accumulation zone before a strong breakout.
If the pattern holds, the coin price could rise 30% to challenge the neckline resistance at $0.000016.
