Dogecoin’s [DOGE] price has declined by more than 4% in the past 24 hours, despite a shift in the behavior of participants.
Following its recent corporate restructuring, the memecoin saw immediate aggressive buying activity. How will this move affect the price action of Dogecoin going forward?
$83M DOGE leaves Bithumb: Accumulation in progress?
As per Whale Alert, well over 900 million DOGE tokens, valued at about $85 million at the time of writing, were withdrawn from the Bithumb exchange. Before this withdrawal, the addresses received DOGE tokens in bits of 50 million.
Subsequently, they withdraw the tokens in three transactions, each constituting 300 million DOGE valued at around $27.69 million. All this happened in less than 30 minutes, indicating it was a structured accumulation.
Apart from this whale accumulation from Bithumb, retail traders were also buying DOGE from other CEXs like Coinbase, Binance, and HTX. That is, 40.75 million DOGE entered exchanges while 119.8 million coins left, resulting in a net outflow of $7.4 million.
From both activities, it was evident that the memecoin was under an intense accumulation trend. Such moves hint at a looming spike to the upside.
Will Dogecoin hold above the support level?
The charts confirmed this accumulation trend even though it was bearish in structure.
The Money Flow Index (MFI), at 55, confirmed that capital was flowing into the memecoin’s market. Meanwhile, DOGE has been defending $0.090 since mid-March, but losing the level would turn the structure bearish even in the short term.
Even the Bollinger Bands (BB) on the daily chart were squeezing.
Compressions often precede expansion, and such behavior by the BB suggested a major upward price swing could be on the way. But the outcome was dependent on reclaiming the band at $0.0937 as a support.
That meant there was confluence on the 4-hour and daily timeframe charts, which were all at support levels. The data suggested that the memecoin had potentially reached its bottom.
What needs to happen to reduce long liquidations
The liquidation heatmap showed that longs were being wiped out, amplifying the price drops. Only defending the $0.09 support level would reduce the long squeezes that are keeping DOGE under pressure.
Conversely, massive short positions are being formed to the upside, which could fuel a move to the upside if the accumulation sparks an upside breakout.
Final Summary
- About 900 million DOGE worth $83 million were withdrawn from the Bithumb exchange, signaling accumulation.
- Dogecoin was trading at a support zone across three charts, indicating a bottom may be in place.
