Pepe Coin (PEPE) Price Joined Other Meme Coins in a Rebound as the Santa Claus Rally Happened on Christmas Eve

Pepe (PEPE), the third-biggest meme coin, surged in a high-volume environment as investors bought the recent dip.

Pepe (PEPE) price rebounded sharply on Christmas Eve as the Santa Claus rally arrived in the crypto market. Among the meme coins, Pepe price showed strength with high volumes as investors bought the recent dip.

The rally comes as Bitcoin (BTC) price surged to $98,500, and the crypto fear and greed index showed signs of entering the greed zone.

Most cryptocurrencies showed signs of a rally, with the total market cap of all coins showing a high of $3.60 trillion, as noted by CoinGecko.

Pepe had a 24-hour volume of $2.2 billion, while the futures open interest showed an increase for the third consecutive day, reaching a high of $151 million. It showed a rise to the highest level since December 30.

The coin also showed signs of bottoming out as the Market Value to Realized Value indicator showed that Pepe was trading at its cheapest since November 5.

The MVRV-Z score indicator is widely considered one of the most precise contrarian indicators in predicting tops and bottoms.

The indicator is calculated by considering an asset’s market price and the realized value. The MVRV value dropped to 1.28, a sign that it is becoming heavily oversold.

The last time that Pepe had this MVRV value was in November, and the coin showed a strong rally to an all-time high of $0.00002830.

Another contrarian case for Pepe is that there are signs speculators capitulated and exited their trades. Data showed that the number of active, new, and zero balance addresses dropped by over 20% in the last seven days.

As seen below, the active addresses ratio dropped to 1.34%, its lowest level in over a month. Most Pepe price breakouts occurred when the ratio showed a decrease.

Pepe coin price analysis: 4-hour chart

The 4-hour chart shows that the Pepe coin price peaked at $0.00002830 earlier this month and then faced a harsh reversal.

It dropped below the critical support level at $0.00001713, which was also the upper side of the cup and handle pattern that formed between May and November. A break and retest pattern usually indicates a continuation. Pepe remained above the 100-day moving average and showed signs of attempting to flip the 50-day MA.

So, is the Pepe price crash over? Not yet, as this rebound could be a dead cat bounce. It could also be part of the formation of a bearish flag chart pattern, which is a common downward continuation sign.

Hence, there is a risk that the coin will resume the downtrend once the Santa Claus rally ends. A complete bullish breakout will be confirmed only when the coin rises above the psychological point at $0.000025.

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