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Pepe, a trending cryptocurrency, is encountering resistance at a critical level. While this rejection may appear concerning, it could signal the start of a bullish continuation pattern. Traders are closely monitoring for a potential higher low formation, which could pave the way for a strong upward move in the coming sessions.

Current Pepe Price Action

Pepe is currently testing a significant local resistance zone, marked by the 0.618 Fibonacci retracement level and the value area high of the local range. This area is not necessarily bearish but rather a key technical point that could serve as a springboard for bullish momentum. A rejection from this resistance could lead to a retracement, forming a higher low — a classic signal of a bullish continuation if followed by upward price movement.

Key Points to Watch

  • Pepe is testing resistance near the 0.618 Fibonacci retracement and value area high.
  • A rejection could trigger a sweep of swing low liquidity near the point of control.
  • The bullish structure remains intact if a higher low forms and support is reclaimed.

Technical Analysis: Lower Time-Frame Insights

If the current rejection materializes, Pepe’s price could rotate down toward the point of control, which aligns with the VWAP (Volume Weighted Average Price) support level. This confluence strengthens the technical case for a potential bounce. Additionally, liquidity has been accumulating below the current range since last week, setting up the possibility of a swing failure pattern (SFP).

“A sweep of swing low liquidity followed by a quick recovery would confirm a higher low structure, signaling a potential rally toward the recent swing high.”

Should this scenario play out, traders could see a significant upside of approximately 35%, assuming broader market conditions remain supportive. The performance of major cryptocurrencies like Bitcoin and Ethereum will play a crucial role in determining Pepe’s trajectory. If these assets continue to trend upward, Pepe is likely to follow suit with a bullish reaction from support levels.

Critical Support Levels to Monitor

  • Point of control region — a key support zone where buyers may step in.
  • VWAP confluence — aligns with the point of control and adds to the technical strength of this level.

However, if the point of control and VWAP support fail to hold, the outlook could shift bearish. In this case, Pepe might test lower levels, potentially invalidating the higher low thesis and creating further downside risk.

What to Expect in the Coming Sessions

As long as Pepe maintains support around the point of control and VWAP confluence, the price structure remains favorable for a higher low formation. If this structure is confirmed, traders could anticipate a move back toward the recent swing high, offering a potential 35% upside. On the other hand, a breakdown below these critical levels would flip the bias bearish, opening the door for further declines.

For now, the market dynamics suggest a leaning toward bullish continuation. The reaction around this technical region will be pivotal in determining the next major move for Pepe. Traders should closely observe price action and volume to adapt their strategies accordingly.

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