Top 4 Reasons Why Pepe Coin Price Crash Has More Room to Go

Pepe Coin price remains in a deep bear market that has wiped out over $7 billion in value since December last year. It has plunged by 75% from its all-time high, making it one of the top laggards in the crypto market. Still, key technicals and fundamentals suggest that the Pepe price crash may continue in the near term.

Pepe Coin Price Has Formed a Giant Head-and-Shoulders Pattern

One technical reason that points to a potential Pepe Coin price crash is that it has been forming a large head-and-shoulders chart pattern on the daily chart.

This pattern’s head is at its all-time high at $0.00002840. Its right and left shoulders are at the same level of $0.000017. It is now hovering at the shoulder level of $0.000006428.

A perfect head-and-shoulders pattern like this normally leads to a strong major crash. The price target is estimated by measuring the distance from its head to the neckline, which, in this case, is 75%.

One then measures the same distance from the neckline, which in this case, brings its price to $0.000001540, its lowest level since February last year. Such a move will be a 95% drop from its all-time high.

Pepe Coin price has more bearish signals that may lead to more downside in the near term. For example, it formed a death cross pattern in August as the 50-day and 200-day Exponential Moving Averages (EMA) crossed each other. It has also remained below the Supertrend indicator, a sign that bears are in control.

Pepe Demand Has Waned

The other main reason why the Pepe Coin price may crash soon is that it is not as popular as it was a few months ago, when it was one of the most actively traded meme coins in the crypto market.

Data compiled by CoinGlass shows that the futures open interest has plunged this month, a sign of weak demand and deleveraging among investors. Its interest plunged to just $256 million on Thursday, October 30, down from the year-to-date high of $1.02 billion.

The same is happening in the spot market, where its volume tumbled from a high of $2.72 billion on October 11 to $776 million today. Its YTD daily volume peaked at $5 billion on July 12.

The declining volume in the spot and futures markets, coupled with the negative funding rate, is a sign that the coin will likely continue to fall in the coming weeks or months.

Rotation from Meme Coins as the Altcoin Season Index Falls

The other main reason why the Pepe Coin price has more downside potential is that there are signs of weak demand for meme coins as investors rotate into Bitcoin and Ethereum.

One evidence for this is that most meme coins have plummeted in the past few months. Shiba Inu price has imploded, with its market capitalization falling from over $20 billion last year to $6.8 billion today.

Data compiled by CoinGecko shows that the market capitalization of all Solana meme coins has dropped to $8.217 billion, down from $22 billion earlier this year. This plunge occurred as the Altcoin Season Index retreated to 31 and Bitcoin dominance increased.

Whales are Dumping Pepe Tokens

Meanwhile, whale investors believe that the Pepe price will continue falling in the past few months. Data compiled by Nansen shows that these investors now hold over 5.01 trillion tokens, down from over 7.01 trillion in August.

Public figure investors have also dumped their tokens and now hold 86.33 billion, down from 340 billion in July. Some of the public figures holding Pepe are Justin Sun, Steve Aoki, and John Perkins. Smart money investors have also continued selling their tokens.