Friday, 19 April 2024

Crypto News

Is Bitcoin overheated? Some believe the answer is hiding in PEPE

Is Bitcoin overheated? Some believe the answer is hiding in PEPE

Could Bitcoin (BTC) be headed for an imminent pullback? Some crypto market observers believe the answer could be hiding within the price action of a frog-themed memecoin.

In an Oct. 27 post on X (formerly Twitter), Onchain Capital co-founder and Crypto Banter host Ran Neuner suggested that memecoin Pepe (PEPE) is a strong indicator of overblown crypto market fever.

“If you want to know when a pull back is coming, just watch $PEPE. It’s literally an index for when the market is getting overheated,” said Neuner.

“When people are confident enough to go there and it pumps, that’s your sign to exit. Works every time.”

Pepe recently witnessed a more than 100% gain, growing from $0.00000064 on Oct. 20 to a peak of 0.00000134 on Oct. 27. Around the same time Pepe reached its peak, Bitcoin had already begun sliding downward from a just-attained year high. 

Neuner’s theory has been shared by other crypto traders in the past. On Sept. 23, trader AlexRTB told his 60,000 followers that he had begun using Pepe as a reliable metric for impending short-term declines.

However, the theory also attracts a fair share of skeptics, while the data hasn’t always supported the theory.

Dubai-based trader Reetika told Cointelegraph that Pepe’s recent uptick was largely driven by bullish news regarding changes in the team and the fact that it would be burning additional tokens, and wasn’t necessarily a sign of broader overconfidence in the market.

As comparative data from TradingView shows, the price of…

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