The price of PIPPIN has surged dramatically, causing this memecoin to approach its all-time high once again. Although the momentum remains strong, continuous selling from investors may become a test of the sustainability of this surge.
The question now is whether PIPPIN can maintain buying pressure and turn resistance levels into sustainable support.
PIPPIN is not overheated.
The network value to transaction (NVT) ratio remains low compared to the recent price surge. Historically, an increase in speculative assets often drives the NVT ratio up, and when NVT rises, it typically indicates that market value is outpacing blockchain activity, signaling overbought conditions.
In the case of PIPPIN, stable NVT figures indicate that the proportion of network usage is expanding alongside the price. Transaction volumes continue to grow alongside market value. Such unity helps reduce the likelihood of a sudden price correction due to concerns about overvaluation.
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A low NVT ratio during price increases often reflects good user engagement, showing that the price increase is due to actual user participation and not just speculation. Therefore, for investors who value fundamental factors on the network, this metric supports the view that PIPPIN has a solid foundation for this recent price breakout attempt.
Will investor selling impact PIPPIN?
Data from exchanges shows that holders have been gradually selling coins over the past few days. Since the beginning of the month, over 41.95 million PIPPIN tokens have been transferred to exchanges, representing more than 17 million USD of supply converted to cash at current prices.
Such selling often reflects short-term profit-taking after a rapid price increase. However, merely distributing tokens into the market is not enough for a signal of a bearish reversal. In a strong uptrend, having more coins in exchanges may align with strong demand from new players absorbing the supply into the market.
The combination of rising prices, stable NVT, and inflow of coins on exchanges may indicate absorption, with buyers seemingly ready to absorb selling pressure without breaking key support. This phenomenon often occurs in the early to mid-stages of a bull market when demand outpaces quiet coin distribution, even amidst some profit-taking.
The price trend of PIPPIN is soaring.
The price of PIPPIN surged 159% in the past five days, trading at USD0.419 at the time of this news release. This memecoin has become the highest-yielding digital asset this week, and the technical chart indicates that the token is approaching a breakout from a downward expanding wedge pattern.
The formation of the wedge is expected to have a chance of rising another 221% if confirmed clearly. A decisive movement above USD0.518 and becoming support will confirm this breakout pattern. Even though PIPPIN may not reach the predicted peak, momentum may still push the price through the previous high of USD0.720 towards the target of USD0.800.
However, risks still exist for short-term traders. If the NVT ratio begins to rise while selling pressure continues, transaction movements may decrease, and a failed breakout could pull the price back down to USD0.267 or even USD0.186. Such a decline would negate the current uptrend and clearly shift the momentum direction to bearish.
