Long-Term DOGE Holders are Selling as Dogecoin Surges 36% – Is the Rally Over?
Dogecoin’s price rally is under pressure as long-term holders sell in record volumes. To maintain its momentum, DOGE must hold $0.220 and aim for a breakout above $0.245.
Dogecoin (DOGE) has seen a modest recovery in price recently, posting a 36% rise this week. However, this rally faces potential obstacles, as long-term holders (LTHs) have started selling their holdings in significant volumes.
This selling trend could create volatility, hindering Dogecoin’s ability to maintain its recent gains.
Dogecoin Key Investors Take Profit
The Age Consumed metric for Dogecoin has shown a sharp spike, signaling that LTHs are selling their holdings at a pace not seen since June 2023. This increase in selling activity marks the heaviest selling in almost two years, highlighting a shift in investor behavior.
LTHs are often viewed as the backbone of a cryptocurrency, and their decision to sell could introduce heightened volatility in the market.
As LTHs begin to liquidate their positions, this selling pressure could undermine the current rally. The reduction in holdings from long-term investors may also raise concerns among shorter-term traders, creating uncertainty.
Dogecoin Age Consumed. Source:
Santiment
The overall macro momentum for Dogecoin is showing mixed signals. According to the Ichimoku Cloud indicator, Dogecoin continues to show bearish momentum. While the candlesticks are above the cloud, indicating a potential uptrend, the pressure from LTH selling could reverse this momentum.
While the Ichimoku Cloud’s position suggests some positive movement, the sustained selling by LTHs could quickly dampen any optimism. If this selling pressure continues, it could lead to a reversal in price momentum, keeping Dogecoin from maintaining its recent gains.
Dogecoin Ichimoku Cloud. Source:
TradingView
DOGE Price Needs To Secure Its Gains
Although Dogecoin’s price has risen by 36% this week, it remains vulnerable to a decline below $0.200. The recent rally, while impressive, is still susceptible to the ongoing selling pressure from long-term holders. As such, Dogecoin could face challenges in maintaining its price above the current levels.
Trading at $0.234, Dogecoin is approaching a critical support level at $0.220. If the price fails to hold this level, it could fall to $0.198, erasing a significant portion of the recent gains.
This would indicate that the selling pressure is overpowering the bullish momentum, potentially triggering a further decline.
Dogecoin Price Analysis. Source:
TradingView
However, if Dogecoin manages to secure $0.220 as support and rebounds off this level, it could attempt to flip $0.245 into a support level.
A successful move above $0.245 would pave the way for a rise to $0.268, allowing Dogecoin to invalidate the bearish outlook and maintain its upward trajectory.
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
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