Key metrics point to potential rally for undervalued PEPE

Recent data points to a potential buying opportunity for Pepe (CRYPTO:PEPE), the popular frog-themed meme coin on Ethereum (CRYPTO:ETH), which has seen a 42% drop in value over the past 90 days. 

However, a recent surge in trading volume and key technical indicators suggest a possible bullish reversal could be on the horizon. 

PEPE's trading volume jumped by 48% today, signaling renewed market interest. 

Despite this increase, many short-term holders remain at a loss. 

The Market Value to Realized Value (MVRV) ratio for PEPE currently stands at 1.34, according to IntoTheBlock. 

This ratio helps identify market tops and bottoms by comparing the total value of holdings to the value invested. 

A lower MVRV ratio generally indicates that investors are holding at a loss and are less likely to sell, hinting that PEPE may have reached a market bottom. 

The Money Flow Index (MFI), another key indicator that measures buying and selling pressure, also suggests a bullish reversal. 

On September 7, the MFI for PEPE dropped to 17.25, indicating oversold conditions. 

As of now, the MFI has slightly increased, potentially pointing to a shift in market sentiment and an upcoming price rally. 

PEPE’s price, currently around $0.0000070, is positioned in a demand zone that previously triggered a rise to $0.0000087 in early August. 

Analysts suggest that breaking through the resistance level at $0.0000075 could pave the way for a climb to $0.000010, representing a potential 53% gain from its current price. 

However, failure to clear this resistance could lead to a retracement back to $0.0000066. 

While the outlook appears optimistic, traders should remain cautious. 

If PEPE fails to break past critical resistance levels, the forecasted rally might not materialize, and further declines could follow. 

At the time of writing, the Pepe (PEPE) price was $0.057322.