- PEPE faces rising selling pressure as whales reduce holdings and exchange supply increases.
- Negative funding rates and falling Open Interest reflect weakening trader confidence.
- Losing key support could trigger another 20% decline toward lower price levels.
PepeCoin — PEPE, has entered a critical phase after recent selling pressure erased much of last month’s recovery. Market sentiment has weakened as traders reduce exposure and large holders trim positions. Technical signals now point toward an important support test. A failure to defend this level could trigger another sharp decline. The coming sessions may decide whether buyers regain confidence or sellers extend control across the meme coin market.
Weak Sentiment Weighs on PEPE
PEPE remained stable on Tuesday after falling nearly 5% during the previous session. Despite that pause, several market indicators continue favoring the bears. Retail participation has slowed, while speculative demand keeps fading. CoinGlass data shows futures Open Interest dropped almost 15% alongside Monday’s decline. Lower Open Interest often reflects fewer active positions across the derivatives market. That trend usually signals weaker trader confidence rather than fresh buying interest.
Funding rates have also turned negative. Current funding stands near negative 0.0081%. Such readings show short sellers now hold a stronger position than bullish traders. On-chain data adds another warning. Santiment reports that major holders have reduced exposure during recent weeks. Supply controlled by top addresses declined from 171.12 trillion PEPE during late June to 164.65 trillion. Large non-exchange wallets also reported lower balances.
Meanwhile, exchange reserves continued climbing. Available supply increased from 18.62 trillion PEPE last week to roughly 18.94 trillion. Rising exchange balances often suggest greater selling pressure. More available tokens can make upward price moves harder to sustain. Together, these signals show confidence has weakened across several market segments. Retail traders have become cautious. Large investors have also reduced holdings instead of increasing exposure.
Can Buyers Defend Key Support?
Technical conditions remain under pressure. PEPE trades below both the 50-day and 100-day exponential moving averages. Those levels continue acting as strong resistance during every recovery attempt. Attention now turns toward the 23.6% Fibonacci retracement near $0.00000279. This level represents an important support area for buyers.
Losing that level could expose the previous swing low near $0.00000233. Such a move would represent roughly 20% downside from current prices.Momentum indicators also support the bearish outlook. The Directional Movement Index shows bullish strength fading. Although the positive DI remains above the negative DI, the Average Directional Index has dropped toward 18. That decline reflects weakening trend strength.
Recovery remains possible if buyers regain momentum. The first challenge sits near the 50-day EMA around $0.00000285. Stronger resistance follows near the 100-day EMA at $0.00000311. A move above both barriers would improve the short-term outlook. Until then, sellers continue holding the advantage while traders watch whether key support survives another test.
