Dogecoin, once appreciated by high-profile celebrities and a robust community, is now facing threats of a significant bearish pullback. On-chain data reveals that Dogecoin is facing a decline in whale activity as large holders are now less interested in the meme coin. Analysts view this trend as a red flag, potentially leading to a sharp drop in DOGE prices to new lows in the coming hours.
Whale Interest Flashes Red For DOGE
The leading meme coin, Dogecoin, has faced significant setbacks recently. The meme coin recorded a decline of nearly 17% in the last thirty days due to increased selling pressure near weekly highs. Coinglass data shows a notable increase in long position liquidations over the past 24 hours, as the DOGE price did not meet buyers’ expectations. Dogecoin saw total liquidations exceeding $3 million, with buyers liquidating approximately $2.7 million in long positions.
Analysts believe that the current downturn might continue ahead as sellers increase their domination. A bearish threat might be on the way due to a significant drop in a crucial on-chain metric. According to IntoTheBlock, the large transaction volume for Dogecoin dropped from the peak of $1.02 billion to a recent low of $437 million. This suggests that whales reduced their investment significantly in the meme coin market over the week due to low volatility and Bitcoin’s drop below $60K level.
Large trades usually show that investors are confident about an asset’s future. When these trades drop off, it means the big investors are worried, suggesting they expect the asset’s price to fall.
Also, the sharp decrease in DOGE’s key metric, which tracks large holder activity to exchange flows, highlights this trend. This metric has dropped nearly 400% in the past month, according to IntoTheBlock, showing that these major investors are pulling back.
The long/short ratio on the 5-minute chart has surged above 1 and is now at 2.1, indicating strong bullish dominance. Currently, 68% of positions are long as buyers increase their confidence, while bearish positions make up just 32%.
What’s Next For DOGE Price?
Dogecoin bulls tried pushing the price above the moving averages and $0.11, but were met with strong resistance from bears. Consequently, the DOGE price fell below the immediate Fibonacci levels and is now stabilizing around $0.1. Currently, the Dogecoin price stands at $0.1, having dropped by over 0.6% in the past 24 hours.
Bears are working to strengthen their position by pulling the DOGE/USDT pair down to the critical support at $0.085. If reached, this level could prompt significant buying from bulls. A recovery from $0.085 might enable bulls to attempt another surge past the moving averages. A successful breakout could lead to a rally toward $0.114, although bears are likely to put up a strong defense up to $0.14.
Conversely, if the price falls and closes below $0.085, it could indicate the beginning of a more significant correction, potentially sending the pair downward to $0.07.
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