Pepe coin reawakens with a $14 million rise in open interest
- Pepe price is up 20% over the last 24 hours, breaching the upper boundary of a bearish technical formation at $0.00000071.
- During the same time, open interest is up 13.92 million, rising from $12.57 million to $26.49 million.
- With a 15% climb in sight, a 320% increase in trading volume increases the odds for a continued move north.
Pepe coin (PEPE) appears to have reawakened, testing the upper boundary of a bearish channel with prospects from more gains but it all depends on how much holders are willing to delay their profit appetite.
Pepe open interest rises 110%
Pepe price is up 20% in the last 24 hours, testing the upper boundary of a descending parallel channel at $0.00000071. The recovery rally comes after a 645% fall, with the meme coin trapped within the confirms of the bearish chart pattern. While an uptrend seems likely, PEPE remains in the woods until a confirmed break and close above the $0.00000073 resistance level. Such a move would constitute a 15% climb above current levels.
With the Relative Strength Index (RSI) and the Awesome Oscillator (AO) moving up, momentum seems to be rising, which tips the odds further in favor of the bulls.
PEPE/USDT 1-day chart
Data from cryptocurrency derivatives data analysis platform, Coinglass, shows that open interest for PEPE has recorded a 110% increase to record a $13.92 million change. Specifically, it moved from $12.57 million to $26.49 million between September 22 and 23.
PEPE Open Interest
A rise in open interest, constituting the total sum of short and long positions, indicates new money is coming into the market, thusly, a bullish sign. It increases the odds for a continuation of the current trend. It also points to a renewed interest in PEPE coin among token holders, as it translates to the number of people opening positions outweighing the number of those closing.
Santiment, a behavior analytics platform for cryptocurrencies, corroborates the bullish outlook, showing increased activity on metrics of exchange inflows, outflows, and the number of whale transaction count with more than 100,000 USD in their accounts.
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PEPE Santiment
The many inflows and outflows to exchanges points to increased investor activity. Wintermute Trading, a large market-making company, moved 8.3 trillion PEPE to central exchanges in the transfers it made today. At current rates, this is worth approximately $5.5 million.
On the other hand, a crypto whale with the short wallet address 0x9d5 actively collected large amounts of PEPE from exchanges, while many PEPE tokens worth at least $100,000 were transferred to the exchanges during the day. This could be a sign of intention to sell, and threatens the upside potential for PEPE.
Increased seller momentum could see Pepe price fall back into the grasp of the channel at $0.00000071, with the potential to invalidate the bullish case once PEPE breaks and closes below the $0.00000070 level. Such a move would constitute a 30% fall.
Open Interest, funding rate FAQs
How does Open Interest affect cryptocurrency prices?
Higher Open Interest is associated with higher liquidity and new capital inflow to the market. This is considered the equivalent of increase in efficiency and the ongoing trend continues. When Open Interest decreases, it is considered a sign of liquidation in the market, investors are leaving and the overall demand for an asset is on a decline, fueling a bearish sentiment among investors.
How does Funding rate affect cryptocurrency prices?
Funding fees bridge the difference between spot prices and prices of futures contracts of an asset by increasing liquidation risks faced by traders. A consistently high and positive funding rate implies there is a bullish sentiment among market participants and there is an expectation of a price hike. A consistently negative funding rate for an asset implies a bearish sentiment, indicating that traders expect the cryptocurrency’s price to fall and a bearish trend reversal is likely to occur.
Author
Lockridge Okoth
FXStreet
Lockridge is a believer in the transformative power of crypto and the blockchain industry.
