One analyst has explained how a daily PEPE close outside a certain price range could cause its value to increase by 54%.
PEPE Symmetrical triangle could indicate the next step for the Memecoin
In a new after on X, analyst Ali discussed the recent trend formation in the PEPE price. According to the analyst, the memecoin is currently forming a symmetrical triangle pattern on the one-day chart.
The ‘symmetrical triangle’ here refers to a pattern in technical analysis (TA) that, as the name suggests, resembles a triangle. In this pattern, there are two interest lines between which the price of the asset consolidates over a period of time.
The top line connects successive tops, while the bottom line connects the bottoms. The main feature of the pattern is that these two lines approach each other at approximately equal and opposite slopes (hence the ‘symmetrical’ in the name).
There are other triangle patterns in TA, but they have lines with different angles (as is the case with wedges) or one line parallel to the time axis (ascending and descending triangles).
Like other TA patterns that represent a consolidation phase, the lines of the symmetrical triangle also serve as a point of potential price reversal. The top line usually provides resistance (which can cause tops to form), while the bottom line can provide support (underformation).
When a break occurs from one of these lines, the price could likely see continued momentum in that direction. This implies that a break above the triangle could be a bullish signal, while a break below it could be bearish.
The symmetrical triangle can be seen as a phase of the market where the bulls and bears are standing still, hence the price moves sideways. During a break, one of these wins, and price action follows in that direction.
Naturally, as the lines converge toward a midpoint in this pattern, a breakout becomes increasingly likely as the asset’s price moves closer to the apex of the triangle.
Here is the chart shared by Ali highlighting the symmetrical triangle pattern that PEPE has been trading in recently:
Looks like the asset's price is getting closer to the converging point of the pattern | Source: @ali_charts on X
As visible in the chart, the 1-day price of PEPE has recently approached the apex of the triangle, implying that a breakout in some direction may be coming for the memecoin.
“Watch out for a daily close outside the $0.00000793 – $0.00000664 range, which could lead to a 54% move for PEPE,” the analyst explains. Given the pattern that has formed, it now remains to be seen how the asset’s price will develop from here on out.
PEPE Award
At the time of writing, PEPE is trading around $0.000006868072, up 3% in the past week.
The price of the memecoin appears to have gone down recently | Source: PEPEUSD on TradingView
Featured image from Shutterstock.com, charts from TradingView.com
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