Pepe faces strong selling pressure: Is there a chance for recovery?

Pepe (PEPE) has experienced a 2.66% decrease in value over the past 24 hours and a decline of up to 14.71% over the past week. This coin is following the overall downtrend of the memecoin market; however, it has been one of the worst-performing assets among popular meme coins this week.

The bearish trend remains strong in recent 24-hour trading. Nevertheless, there is hope for a Bitcoin (BTC) short squeeze to $70,000 by the end of this week, which could help ease the short-term selling pressure on PEPE.

PEPE Bears Fail to Break Local Support

On the daily chart (1D), PEPE’s price structure still leans toward a downtrend. This is confirmed when the daily trading session closes below the previous low (marked in orange). Since then, the local support at $0.00000342 has seen a slight rebound.

Source: TradingView Currently, this support level continues to be tested. While it seems like a suitable area for a price recovery, expecting a strong bullish reaction here could be risky. The On-Balance Volume (OBV) indicator on the daily chart is steadily declining, indicating weak buying momentum.

The RSI indicator also confirms that the downward momentum still dominates. Therefore, instead of rushing to buy when the price tests the support level again, traders should consider waiting for this level to break and turn into resistance before entering a trade.

Short-term Short Opportunity Setup

Both the daily chart price structure and the 1-hour price action show a clear downtrend.

Source: TradingView The 1-hour RSI indicator has returned to the neutral 50 level, while the OBV indicator on this timeframe continues its downward trend and has failed to form new highs in recent days, reinforcing the view that sellers are currently in control.

The retracement zone from 50% to 78.6% in the price range of $0.00000358-$0.0000037 is expected to be an ideal area for short entries in the short term. Profit targets could be set at the 23.6% extension level, while this trading idea would be invalidated if the price closes above the local high of $0.00000379 on the 1-hour timeframe.