Dogecoin dips by 11% this week as whale balances shrink

Key takeaways

• Dogecoin traded near $0.085 on Friday after dropping more than 11% this week.
• Two cohorts of large-wallet holders cut their combined holdings by 100 million DOGE starting Tuesday.
• A daily close beneath $0.084 could target $0.078 and $0.070, with resistance starting at $0.086.

On Friday, Dogecoin changed hands at roughly $0.085, nearing a vital trendline zone following a weekly loss exceeding 11%.

Decreasing balances among specific major holders alongside fading technical momentum point to ongoing downward pressure.

Conversely, derivatives positioning presents a mixed outlook, with long positions exceeding shorts in the ratio monitored by CoinGlass.

Large Dogecoin holders reduce exposure

Data from Santiment’s supply distribution indicates that wallets containing 1 million to 10 million DOGE, alongside those holding 10 million to 100 million DOGE, jointly trimmed their holdings by 100 million tokens starting Tuesday.

This drop implies that select large investors are scaling back their exposure, possibly by taking profits. While balance shifts do not definitively prove every coin was sold, the activity reinforces worries regarding near-term supply headwinds.

CryptoQuant overview metrics also highlight caution. The platform flags overheated conditions across both spot and futures markets, accompanied by heavy order volumes and sell-side dominance in futures trading.

These indicators signal that selling pressure stays robust as DOGE approaches nearby support.

Despite the downward price action, the CoinGlass DOGE long-to-short ratio hit 0.90 on Friday, marking its highest point in over a month.

A reading exceeding one signifies that long positions surpass short positions among the accounts and holdings measured by this index.

Positive funding rates held steady at 0.0010%, showing that long traders compensated short traders to keep their positions open.

Altogether, these metrics imply certain traders are betting on a rebound. However, they do not guarantee that buying interest is robust enough to reverse the slide, particularly while price momentum stays soft.

DOGE tests $0.084 as momentum deteriorates

Dogecoin hovers just above the trendline region around $0.084, acting as the primary technical support zone.

A daily close under that mark could clear a path toward $0.078, while a deeper pullback would focus attention on the next structural floor at $0.070.

The Relative Strength Index hovers around 40, lingering beneath its neutral center line to reflect dwindling buying momentum.

The Moving Average Convergence Divergence line stays beneath both zero and its corresponding signal line, while a negative and slowly growing histogram indicates sellers hold the short-term advantage.

DOGE continues to trade below multiple key exponential moving averages, establishing consecutive obstacles to any recovery.

Initial resistance stands at the 100-day EMA near $0.086. Higher up, the 50-day EMA and a horizontal resistance barrier meet around $0.088.

Surpassing these barriers would alleviate immediate bearish momentum. A more substantial recovery demands a push past the 200-day EMA at $0.093, followed by a test of major resistance close to $0.102.

At present, the interplay between support at $0.084 and overhead moving averages will dictate whether DOGE finds stability or deepens its weekly losses.

Frequently Asked Questions

What was Dogecoin trading at on Friday?

Dogecoin traded around $0.085 on Friday after dropping more than 11% during the week.

How much did large-wallet holders sell or reduce?

Wallets holding between 1 million and 10 million DOGE, as well as those holding between 10 million and 100 million DOGE, collectively decreased their holdings by 100 million tokens since Tuesday.

What are the crucial support levels for DOGE?

The immediate technical support is near the trendline area at $0.084. A close below that level could push the price toward $0.078 and potentially $0.070.

Where does resistance begin for Dogecoin?

Resistance starts at $0.086 with the 100-day EMA, followed by a convergence of the 50-day EMA and horizontal resistance around $0.088.