Pepe’s Death Cross and Negative Funding Signal Deepening Bearish Crossroads

Pepe (PEPE), the second-largest Ethereum-based meme coin, has faced significant price declines, dropping 33% from its June peak as of August 30, 2025, trading at $0.0000100095 [1]. Recent on-chain data reveals increasing bearish sentiment, with the token breaking below a critical support level of $0.0000098 and invalidating a potential double-bottom pattern [1]. A death cross has also formed on the daily chart, as the 50-day and 200-day moving averages crossed, signaling a shift from bullish to bearish momentum [1].

Derivative market indicators further highlight the token’s vulnerability. The weighted funding rate, a key gauge of futures market expectations, has turned negative, reaching as low as -0.011%, marking its lowest level since August 24 [1]. A negative funding rate typically suggests that traders anticipate further price declines, as short positions gain dominance over longs. Open interest, a measure of the total number of outstanding futures contracts, has also declined to $548 million from a July high of over $1 billion, indicating weakening demand [1]. Additionally, liquidations, where leveraged positions are forcibly closed due to adverse price movements, have surged, amplifying downward pressure on the price [1].

Whale and smart money activity has shown mixed signals. While whale accumulation briefly fueled a 5% price rally on August 7, 2025, due to expectations of rate cuts and macroeconomic optimism, more recent data shows a shift. Over the past 30 days, smart money holdings have dropped 23%, and whale positions have stagnated [1]. A large whale recently deposited 588 billion PEPE tokens—worth approximately $10.99 million—into a centralized exchange, highlighting the influence of large holders on market dynamics [1].

Market sentiment remains polarized. Despite PEPE's record holder count of 472,158 as of August 4, it underperformed compared to Dogecoin (DOGE) during a broader $5 billion meme coin rally [1]. Analysts have noted that PEPE’s supply is more concentrated among top wallets, which can affect price stability. However, bullish expectations persist in some corners of the market. On August 9, 2025, investor sentiment for PEPE and other meme coins reached record highs, with some forecasts projecting PEPE as a top performer among meme tokens by 2030 [1].

The broader macroeconomic environment continues to impact the token's performance. In late July, technical analysis suggested a potential 22% drop for PEPE if key resistance levels were not reclaimed, with on-chain data showing increased short positions and inflows [1]. On August 5, the 32% drop from July highs was attributed to global tariff concerns and macroeconomic uncertainty, underscoring the token's sensitivity to external factors [1]. While some analysts suggest that a decline in active deposits could signal a recoverable phase for PEPE, the overall trend remains bearish for the near term [1].

Source:

[1] Pepe Coin tanks below key support, a deeper decline awaits (https://crypto.news/pepe-coin-price-death-cross-key-support-deep-decline/)

[2] Pepe Price, PEPE to USD, Research, News & Fundraising (https://messari.io/project/pepe)