Is Meme Coin PEPE a Reliable Indicator for Bitcoin Price Fluctuations?
Summary:
Ran Neuner, co-founder of Onchain Capital, suggests that the meme-based digital coin Pepe (PEPE) can be used as an indicator of an overhyped cryptocurrency market, leading to potential Bitcoin (BTC) declines. However, this theory has been met with skepticism, as critics argue that data does not always back up these claims. Dubai-based trader Reetika posits that Solana’s SOL (SOL) might serve as a more reliable predictor for BTC price trends.
Could a drop in Bitcoin's (BTC) price be on the horizon? This is what some cryptocurrency market experts are indicating, hinting that the clue may be found in the price trends of a meme-based digital coin themed around a frog. Ran Neuner, co-founder of Onchain Capital and host of Crypto Banter, expressed his viewpoint via an Oct. 27 post on X (previously known as Twitter). He stated that the behaviour of meme cryptocurrency Pepe (PEPE) might be a key marker of an overhyped cryptocurrency market.
According to Neuner, whenever there's a surge in PEPE, it suggests the market is becoming excessively heated. When traders are bold enough to invest, causing it to surge, that's a sign to withdraw from the market. This pattern, he claims, has always been accurate.
PEPE recently demonstrated impressive gains of over 100%, increasing from $0.00000064 on Oct. 20 to an apex of $0.00000134 on Oct. 27. Coinciding with this, Bitcoin experienced a tumble after reaching a new yearly high.
Several other cryptocurrency analysts have supported Neuner's theory in the past. For instance, on Sept. 23, Alex RTB informed his follower base of 60,000 that he uses PEPE as a key indicator of imminent short-term downturns.
Despite the traction of this theory, it has also met with skepticism. Critics point out that previous data does not always substantiate these claims.
Dubai-based trader Reetika countered to Cointelegraph that the recent rise in the value of PEPE was mainly a reaction to team changes and news of forthcoming token burns, rather than a reflection of the overall market hyper-optimism.
Compared data from TradingView suggests that Bitcoin and PEPE prices are often closely linked, which could make the meme coin a difficult market indicator. Instead of PEPE, Reetika suggested a closer focus on Solana’s SOL (SOL) as a possibly more trustworthy predictor.
She explained that SOL’s movements have often been an accurate forecast indicator, but also clarified that it isn't foolproof, even though it has proven reliable of late. Additionally, market observer and known cryptocurrency satirist, Poordart, conveyed to Cointelegraph that Pepe might not be the optimal gauge to anticipate the major price actions of Bitcoin, considering its relatively recent introduction to the market.
Published At
10/27/2023 4:48:00 AM
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