Since bouncing off a long-term descending resistance trend line on January 8, PEPE’s price has increased but failed to sustain the rise, nearly returning to the trend line. The cryptocurrency experienced a downward trend since May 2023, hitting a low in September before initiating an upward movement. After a fourth unsuccessful breakout attempt in November, PEPE successfully declined the following month, peaking on December 9, then fell back to the descending resistance line, confirming it as support on January 8.
Investors use the Relative Strength Index (RSI) to assess whether a market is overbought or oversold and whether an asset should be accumulated or sold. Currently, the daily RSI is at 50, indicating no clear trend direction. Similarly, the six-hour time frame shows a potential bottoming signal, possibly due to wave counting and price action.
Technical analysts apply Elliott Wave theory to determine the trend direction by examining recurring long-term price patterns and investor psychology. It suggests PEPE may have completed a five-wave upward movement and is now correcting within a descending parallel channel.
Although not confirmed, the correction might have ended on January 8 due to a bounce from the channel’s support trend line and the 0.618 Fibonacci retracement support level. A breakout from the descending parallel channel could confirm a bullish outlook. If both upward movements are equal in length, PEPE’s price could surge by 80% to the next resistance at $0.0000022.