Pepe (PEPE) made a surprising resurgence in late June, with a resounding 85% price surge in the second half of the month. However, on-chain data now flashes mixed signals. What next for PEPE price in the coming days?
Between June 15 and July 4, PEPE price is up 85%. While bullish speculators are filling up their bags, on-chain data shows that some investors have started to book profits. Will it trigger a price correction in the coming weeks?
PEPE Long-term Holders are Booking Profits
PEPE price has dominated the memecoin price charts in recent weeks. But now, some holders are now taking advantage of the high prices to book profits.
On Monday, PEPE recorded an astronomic spike in Age Consumed. The chart below shows the PEPE Age Consumed soared to 365 trillion on July 3.
Age Consumed evaluates the trading sentiment among long-term investors. It is calculated by aggregating the number of recently moved coins multiplied by the number of days spent in their previous wallet addresses.
As seen above, sudden spikes in Age Consumed during a price surge indicate that many investors are offloading their holdings.
According to the historical data, the last time PEPE Age Consumed rose to this level was May 19. And notably, it was quickly followed by a 30% price correction.
If this pattern reoccurs, PEPE holders can anticipate another price downside over the next few weeks.
Network Activity Has Slowed Down this Week
Furthermore, despite the recent price gains, PEPE has actually registered a significant decline in user activity this week. This suggests that the activities of bullish speculators are the major driver behind the price surge.
As shown below, PEPE price has increased by 16% between June 28 and July 4. But, a deeper analysis of the PEPE Daily Active Addresses data shows that user activity has slowed by 24%.
In concise terms, the Daily Active Addresses (7d) sums up the number of unique addresses that carry out transactions over a seven-day period. When it increases during a price rally, as seen above, it indicates that price gains are mostly driven by market speculation rather than underlying economic activity.
Unless user activity increases significantly to match the price uptrend, PEPE could retrace again in the coming weeks.
PEPE Price Prediction: Another Retracement Below $0.0000010
Considering the factors highlighted above, the bears will likely trigger a retracement below $0.0000010 in terms of what is next for the PEPE price.
But first, the 13,670 investors that bought 136.09 trillion at the minimum price of $0.0000010 could keep the bears at bay.
But if that support level caves, the PEPE price could drop to $0.0000008 again.
Conversely, if PEPE can attract enough user activity, the price rally could continue toward 0.000002. Although, the 35,430 investors that bought 80.09 trillion PEPE tokens at the maximum price of $0.000002 could halt the rally.
Nevertheless, the bulls push the rally toward $0.000003 if that resistance level does not hold.