Pepe (PEPE) recently achieved a new local high at $0.0000108, while dogwifhat (WIF) touched the $3.56 mark. However, despite these peaks, concerns over a potential market correction arose amidst Bitcoin's decline from $73.7k to $68.4k at press time. Here's what technical analysis reveals about these meme coins.
The Relative Strength Index (RSI) of PEPE on the 4-hour chart consistently remained above the neutral 50 mark in March, indicating sustained bullish momentum. Additionally, the market structure remained bullish. Fibonacci retracement levels suggested the possibility of a move to the 61.8%-78.6% region. However, the On-Balance Volume (OBV) remained flat, indicating a lack of significant buying volume and an equilibrium between buyers and sellers.
Source: PEPE/USDT on TradingView
Should PEPE drop below the $0.0000079 support zone, buyers might consider re-entering the market within the demand zone based on Fibonacci retracement levels.
Source: WIF/USDT on TradingView
Similarly, WIF exhibited a bullish trajectory, with high trading volume and a soaring OBV, signifying robust demand. Although the RSI fell below the overbought territory, indicating a slowdown in momentum, it remained strongly bullish. The Fibonacci levels plotted were tentative, as the upward move had not yet concluded.
While the $3 psychological support zone has held for WIF, a drop below this level could prompt a retest of the $2.17-$2.46 area, likely resulting in a bullish reaction.
Examining price action alongside Open Interest (OI) charts provides insights into speculative sentiment. Despite WIF demonstrating bullishness, PEPE traders appeared less optimistic. The OI for PEPE began declining on March 14, coinciding with a more than 10% price drop, indicating a shift in short-term conviction.
Source:Coinglass
Conversely, WIF's OI did not decrease as sharply, suggesting a weaker bearish outlook in the near term despite prices trending higher. However, given Bitcoin's price decline, both meme coins face the possibility of continued slumps, despite their strongly bullish higher timeframe charts.
Source:Coinglass
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