PEPE price prediction: Bullish breakout could be the start of a rally

PEPE has been trending higher lately, with its price gaining by 5.79% in the last 24 hours. Several factors have contributed to this rally

PEPE price rose by 5.79% in the last 24 hours as it continues trending higher. Several factors that could be aiding this rally were technical activity on its price chart and a majority bullish alignment that can be supported by market participants, except for spot traders who are betting against a breakout as many had started selling after days of accumulation.

This bullish structure is a descending channel, characterized by a support line and a resistance line, with each rally beginning after a breach of the upper resistance.

At the time of writing, PEPE had broken through this upper resistance, leading to its 24-hour gains.

After the breakout, the price had risen, and projections from its press time level hinted at a possible rally of 273%, which could push the asset to $0.00002786.

However, it’s important to note that the rally to this projected level may not happen directly. Instead, the price could consolidate—similar to what occurred after the breakout of the second pattern—before reaching its target.

Here, it’s worth pointing out that market sentiment has remained strong. In fact, the overall trading volume increased by 38.17% to hit $896 million.

A hike in volume, alongside a price surge, usually indicates strong market momentum and shows that the asset may be gearing up for a major move upwards.

In the Futures market, Open Interest was also elevated, with $348 million worth of PEPE contracts open.

Now, while this metric represented the total contract size, it doesn’t directly reflect bullish or bearish sentiment. To better gauge market direction, AMBCrypto used the Open Interest (OI) Weighted Funding Rate.

This metric, which combines Open Interest and funding rate data in derivatives, helps determine whether sentiment leans bullish (positive) or bearish (negative). In this case, it has stayed positive over the past three days, with a press time reading of 0.0093%.

If the metric continues to remain positive, PEPE could climb higher and potentially hit its price target.

Finally, spot traders appeared to be showing some resistance to the projected rally. Especially as they began selling following the bullish breakout. When this kind of selling follows noticeable price gains on the chart, it often means that traders are taking profits.

At the time of writing, spot traders had sold $8 million worth of PEPE. This trend may continue if the price climbs higher since stronger gains offer more incentives to sell.

Sustained selling will likely delay PEPE’s price breakout, allowing for more consolidation before the next major move.