Is PEPE's Recent 2.6% Weekly Gain a Reliable Sign of a Reversal or Just a Fleeting Rally?

The recent 2.6% weekly gain in PEPE's price has sparked renewed optimism among retail investors, but a closer examination of on-chain metrics and whale behavior reveals a more nuanced picture. While short-term price action suggests a potential rebound, diverging signals from transaction volume, wallet activity, and derivatives markets highlight the fragility of this rally. This analysis contrasts the immediate bullish narrative with the cautionary undertones embedded in PEPE's blockchain data.

Short-Term Price Action: A Fragile Foundation

PEPE's 2.6% weekly gain, as tracked by platforms like Blockchain.com, has been fueled by a surge in transaction volume. Over the past seven days, daily trading volume exceeded $403 million, with peak 24-hour transactions hitting 10 trillion PEPE tokens. This spike in activity, coupled with the token defending its $0.00000575 support level, has led some analysts to speculate about a short-term rebound. However, technical indicators remain mixed: while near-term buyers appear to be stabilizing price, medium- and long-term trends remain bearish.

On-Chain Metrics: Mixed Signals Amid Volatility

On-chain data from Glassnode and Coingecko reveals a divergence between price action and broader network activity. The number of active addresses-unique wallets participating in transactions-has risen, indicating heightened engagement. Yet this increase coincides with a fully unlocked circulating supply of 420 trillion tokens, which inherently weakens the token's scarcity-driven appeal.

Whale activity further complicates the narrative. While one significant whale spent $2.5 million in USDT to accumulate 213.46 billion PEPE tokens, other top wallets have shown outflows, suggesting profit-taking or risk mitigation. Derivatives market data also indicates that whales and top traders are trimming long exposure during the price advance, a move typically associated with bearish sentiment.

Whale Behavior: Accumulation vs. Exit

The contrast between accumulation and exit activity among large holders underscores the uncertainty surrounding PEPE's trajectory. On one hand, the $2.5 million whale purchase demonstrates confidence in the token's potential. On the other, the absence of net inflows into top 100 wallets over the past 24 hours signals caution. This duality reflects a market where institutional or sophisticated investors are hedging their bets, rather than committing to a sustained bullish thesis.

Derivatives and Market Sentiment: A Cautionary Tale

Derivatives markets provide additional context. As reported by crypto news outlets, whales and top traders are reducing long positions amid the price rally. This behavior often precedes corrections, as large players lock in profits or prepare for downside scenarios. Traders are now closely monitoring volume spikes and whale activity for signs of renewed accumulation, but the lack of follow-through in these metrics raises questions about the sustainability of the current rally.

Conclusion: A Fleeting Rally or a Precursor to Reversal?

PEPE's 2.6% weekly gain is a positive short-term development, but it lacks the robust on-chain and whale-level support typically seen in sustainable reversals. The token's fully unlocked supply, bearish medium-term technicals, and mixed whale behavior all point to a market in flux. While the $0.00000575 support level may provide temporary stability, investors should remain cautious. A true reversal would require sustained volume, coordinated whale accumulation, and a shift in derivatives positioning-none of which are currently evident. For now, the rally appears to be a fragile, short-term rebound rather than a definitive trend change.