Pepe coin, the second-largest Ethereum-based meme coin after Shiba Inu, has dropped significantly, hitting the key support level of $0.000010. This decline aligns with the broader crypto market correction and Ethereum’s underperformance. Ethereum, the biggest layer-1 blockchain, has lost market share in DeFi, NFTs, and meme coins, leading to weaker demand for Ethereum-based assets like Pepe.

Over the past year, Bitcoin and Solana have surged by more than 70%, while Ethereum has fallen 5%. However, analysts suggest Ethereum could soon rally, with its price forming an ascending triangle pattern. If Ethereum breaks past $4,000, it may accelerate toward $5,000, creating a bullish environment for Ethereum-linked tokens, including Pepe.

Technical indicators for Pepe show mixed signals. Oscillators like the Relative Strength Index and the Percentage Price Oscillator indicate a bullish divergence, suggesting upward momentum. However, the coin is also forming a bearish divergence pattern, with two converging downward trendlines. If a breakout occurs, the first target would be the 200-day moving average at $0.00001351, representing a 35% jump. If the rally continues, Pepe could reach its all-time high of $0.000028, a 175% increase.

On the downside, if Ethereum fails to sustain its recovery, Pepe could drop further, with key support levels at $0.0000060 and $0.0000038. These levels marked the lowest price swings in April and August last year.

Investors are closely watching Ethereum’s price action, as its movement will likely determine Pepe’s next big move. If Ethereum successfully breaks above resistance, Pepe could see a strong upward trajectory, but if bearish pressure persists, further declines remain a possibility.