PEPE's Recent Double Buy Signal: A High-Risk, High-Reward Entry Point?

In the volatile world of meme coins, PEPE has emerged as a standout contender—not for its utility, but for its chaotic charm and technical intrigue. Over the past week, the token has flashed what traders are calling a “double buy signal,” sparking debates about whether this is a genuine reversal opportunity or a trap for the gullible. Let's dissect the technical and on-chain signals to evaluate the risk-reward profile of this trade.

The Technical Case: TD Sequential and Symmetrical Triangles

The first piece of the puzzle lies in the TD Sequential indicator, a tool designed to identify potential exhaustion points in trends. According to a report by Ambcrypto, PEPE's daily chart recently displayed a green “A13” signal on September 22, followed by a red “9” candle on September 24PEPE flashes double buy signals, yet risks remain – Here’s why^[1]. These signals are often interpreted as signs that a downtrend is losing steam, with the red “9” suggesting a possible pause in selling pressurePEPE Charts Flash Double Buy Signal After 17% Drop^[2].

Compounding this, PEPE is consolidating within a symmetrical triangle pattern, a classic technical formation where price action forms converging support and resistance levels. If the token breaks above the upper boundary of this triangle—currently around $0.00000885—bulls could target levels as high as $0.00001550PEPE flashes double buy signals, yet risks remain – Here’s why^[1]. The pattern's validity hinges on volume expansion during the breakout, which has yet to materialize.

On-Chain Signals: Outflows and NVT Concerns

On-chain data adds nuance to the technical narrative. Over $2 million worth of PEPE has exited centralized exchanges in recent daysPEPE flashes double buy signals, yet risks remain – Here’s why^[1], a move that typically reduces immediate selling pressure and signals investor confidence. However, this optimism is tempered by a sharp spike in the Network Value to Transactions (NVT) ratio, a metric that compares market cap to daily on-chain transaction volume. A rising NVT often indicates overvaluation, as seen in previous meme coin cyclesPEPE flashes double buy signals, yet risks remain – Here’s why^[1].

This dichotomy raises a critical question: Are the outflows a sign of long-term conviction, or are traders simply locking in gains ahead of a potential NVT-driven correction? The answer likely lies in how price reacts to key levels in the coming days.

Risk-Reward Analysis: Support, Resistance, and Open Interest

The immediate risk for PEPE lies in its proximity to critical support at $0.00000885. A breakdown below this level could reignite the downtrend, with the next major support zone around $0.00000650PEPE flashes double buy signals, yet risks remain – Here’s why^[1]. Conversely, a successful hold above the triangle's upper boundary could trigger a rally toward $0.00001251, $0.00001420, and eventually $0.00001550PEPE flashes double buy signals, yet risks remain – Here’s why^[1].

However, the bullish case is not without cracks. Open interest in PEPE futures has fallen by over 41% from its recent peakPepe Price Prediction 2025 Sparks Bullish Reversal on TD Signal^[3], suggesting waning speculative interest. While this could free the price from short-term volatility, it also implies a lack of conviction among traders—a red flag for any reversal play.

The Verdict: Proceed with Caution

PEPE's double buy signal presents a compelling case for a short-term reversal, particularly for traders willing to tolerate high volatility. The TD Sequential exhaustion signals and symmetrical triangle setup offer a structured framework for entry, while the on-chain outflows hint at reduced selling pressure. Yet, the elevated NVT ratio and declining open interest underscore the risks of overvaluation and speculative fatigue.

For those considering this trade, the key is to treat it as a high-risk, high-reward proposition. A tight stop-loss below $0.00000885 is essential, while profit-taking at the $0.00001251 level could balance the risk. As always, volume and price action will be the ultimate arbiters of this trade's success.