Is Pepe Coin Ready For Another Pump? Here’s What On-Chain Data Says
12 Mai 2023 - 4:50PM
NEWSBTC
Here’s what the different on-chain indicators from Santiment have
to say about whether Pepe Coin could see another pump soon or not.
The Memecoin’s On-Chain Metrics Have Been Down Since The Top PEPE
has been one of the hottest topics around the cryptocurrency market
recently, thanks to the explosive growth that the meme coin has
enjoyed. Between the end of last month and the 5th of May, the coin
saw its price rise by an extraordinary 1,200%. The uptrend,
however, ended there and the cryptocurrency has been sharply
plunging since then. According to Santiment, the on-chain analytics
firm’s “social dominance” indicator signaled this top in advance.
Social dominance tells us what percentage of the discussions
happening on social media related to the top 100 cryptocurrencies
by market cap are talking about a given coin. As the below chart
shows, Pepe’s social dominance rose to very high values just before
the top took form earlier in the month. Looks like the value of the
metric has come down in recent days | Source: Santiment Whenever
social dominance hits high levels, it’s a sign of euphoria among
investors, which is something that has historically led to top
formations for cryptocurrencies. Santiment notes that the indicator
still has a value of about 5%, meaning that 5% of all discussions
related to the top 100 assets involve the meme coin currently.
“Seeing it get down to the 1-2% range would be a good sign that
traders are beginning to stray away and look for pumps from other
altcoins,” the firm explains. The active addresses metric, which
measures the total number of unique addresses taking part in some
transaction activity on the blockchain, also saw a spike just
before the top. The metric seems to have calmed down | Source:
Santiment When this indicator has a high value, it means a large
number of investors are making trades right now. The price
generally becomes more likely to get volatile when the metric shows
such a trend. From the chart, it’s visible that the active
addresses indicator has come down in value for PEPE in the last few
days, which means that the market activity has calmed down. Related
Reading: Bitcoin Rebounds From $27,100 After Spike In Bearish
Sentiment An interesting trend is also visible in the data for the
supply of the largest Pepe Coin holders, as the below graph
displays. The holdings of the memecoin's whales | Source: Santiment
These humongous holders had been accumulating while the rally had
been going on, but right as the top took form, they started
shedding coins from their wallets. Related Reading: Does The
Bitcoin Price Dump Signal The Start Of Another Bear Market? This
cohort has continued to sell since then as PEPE’s value has gone
downhill. “If you start seeing these lines moving up again, there
is a much larger probability of PEPE going for its 2nd round of
pumping (though probably a more minor one),” explains Santiment.
One positive sign for the asset, however, may be that the trading
volume has rebounded recently after having declined since the top
(just like the other metrics). The trading volume of the asset |
Source: Santiment “All in all, meme coins have to be taken for what
they are. They’re controlled by speculation and crowd
expectations,” says the analytics firm. “In these fresh, new assets
that fit this description, you’ll likely want to watch when the
crowd gets too emphatic that one price direction is going to
happen.” PEPE Price At the time of writing, Pepe Coin is trading
around $0.000001251, down 37% in the last week. The asset continues
to decline | Source: PEPEUSD on TradingView Featured image from
iStock.com, charts from TradingView.com, Santiment.net
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