The cryptocurrency market has just ended a bearish week and it is only natural for investors to expect some relief. ApeCoin [APE] is perhaps one of the few cryptocurrencies that might be more suitable in the event of another bullish race and here’s why.
The APE rallied 147% from its June 2022 low to its recent high earlier this month. However, it has since dropped around 34% from its peak. Here, it’s worth noting that its pullback started slightly earlier than the rest of the market.
This is because he had already significantly extended his rise in the rankings. The strong withdrawal it has produced so far reflects strong profit taking as well as strong selling pressure. Especially since the bears have been rampant across the market this week.
Source: TradingView
The downside of APE has so far approached halfway towards the 2022 lows. At press time, it was trading around the July resistance levels, with a significant likelihood of resistance turning into support. This is because APE’s RSI briefly touched the oversold zone after falling as low as 30%.
APE’s short-term regular moving average also interacted with the 50% RSI level. This result, combined with the short touch of the RSI with the oversold zone, highlighted a psychological buying zone.
Source: TradingView
Is it really a good time to buy?
Although the price is already down by a significant margin, there is still the considerable possibility of further downside. The speed of APE, for example, has dropped significantly over the past 3 days – This seemed to be a sign that sentiment has not yet recovered after the bearish performance of the alt.
Source: Santimento
The low bullish sentiment can be further confirmed by the lack of significant volumes in the past 24 hours. A strong build-up at press time would have been accompanied by a significant increase in purchase volumes.
A similar result was also found with APE’s daily on-chain transactions. The transactions, at the time of writing, have resulted in a loss, especially in the last 24 hours, with the same weight compared to those in profit. This seemed to confirm that even those who recently bought the dip are still at a loss.
Source: Santimento
Conclusion
APE’s on-chain metrics confirmed that purchasing volumes are still significantly low. This was further evidence of the relative uncertainty in the market following its most recent decline.
Some of the best coins in the market like Bitcoin aren’t oversold yet. This could suggest that there is still room for further downside. Ergo, it might be a good idea to wait for the markets to offer more clarity.