Is Bitcoin (BTC) on the verge of a pullback? Some analysts in the crypto market suggest that the answer may be found in the fluctuations of a frog-themed memecoin.
In a post dated October 27 on X (formerly Twitter), Ran Neuner, co-founder of Onchain Capital and host of Crypto Banter, indicated that the memecoin Pepe (PEPE) serves as a strong barometer for excessive enthusiasm in the crypto market.
“To predict when a pullback is approaching, simply monitor $PEPE. It’s essentially an index for gauging market overheating. When confidence drives people there and it surges, that’s your cue to exit. It has proven effective every time.” pic.twitter.com/vMcqiddHwp
— Ran Neuner (@cryptomanran) October 26, 2023
“To predict when a pullback is approaching, simply monitor $PEPE. It’s essentially an index for gauging market overheating,” Neuner stated.
“When confidence drives people there and it surges, that’s your cue to exit. It has proven effective every time.”
Pepe recently experienced an increase of over 100%, climbing from $0.00000064 on October 20 to a peak of $0.00000134 on October 27. At the same time Pepe hit its peak, Bitcoin had already started to decline from a recently achieved yearly high.
Neuner’s hypothesis has been echoed by other crypto traders previously. On September 23, trader AlexRTB informed his 60,000 followers that he had started utilizing Pepe as a dependable gauge for imminent short-term downturns.
This $PEPE surge is yet another sign of an impending #BTC drop.
Based on my experience, you can verify past price trends.
Surging coins like $PEPE, $DOGE, $XRP, $IMX, $LINK consistently indicate a downturn; let’s see how it plays out this time. pic.twitter.com/piseCxRiqD— Alex RT₿ (@rutradebtc) September 22, 2023
Nonetheless, the theory also garners a number of skeptics, as the supporting data has not consistently upheld the claim.
Trader Reetika, based in Dubai, conveyed to Cointelegraph that Pepe’s recent rise was predominantly fueled by positive news concerning team changes and plans to burn additional tokens, rather than signaling a widespread overconfidence in the market.
6.9T $PEPE Tokens worth ~$6,000,000 have been burned. https://t.co/aN5LRUFz8u
A new advisory team has been appointed to propel Pepe forward. The remaining 3.79T tokens attributed to the original team CEX multi-sig wallet will be used for strategic partnerships and marketing… pic.twitter.com/JN3ssvH0XL— Pepe (@pepecoineth) October 24, 2023
As comparative data from TradingView illustrates, the price trajectory of Pepe often shows a close correlation with that of Bitcoin, which may complicate its use as an indicator.
Meanwhile, Reetika proposed considering Solana (SOL) as a potentially more reliable predictor.
“SOL has consistently been a good leading indicator for recent movements. It has broken through resistances at least a day prior to BTC/ETH throughout this entire trend. I’ve found it useful for estimating upward movements,” she remarked.
However, Reetika noted that SOL is not a flawless indicator, but has performed well in the latest trend.
Similarly, market commentator and enthusiastic crypto satirist Poordart expressed to Cointelegraph that Pepe might not be the most effective metric for assessing the future price movements of major cryptocurrencies like Bitcoin.
In Poordart’s opinion, Pepe is still too new to the market to possess any “real lasting value” as a reliable metric for accurately gauging Bitcoin’s price fluctuations.
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