Dogecoin's price is still under pressure. This token has decreased by about 2% in the past 24 hours and more than 12% in the last month. The price trend is weakening, but the rate of decline has slowed.
Although the chart structure still leans towards a downtrend, on-chain signals indicate that the current decline is still uncertain. The next few trading sessions will determine whether DOGE will fall into a deeper decline or maintain the current price level.
Dogecoin price pressure increases as short-term supply withdraws.
Dogecoin is trading near the bottom of the downtrend price pattern while forming a bear flag. This keeps the risk of further price declines present, especially if the support zone around 0.124-0.120 USD is breached. However, it is noteworthy that the behavior of speculative token holders has changed as prices have fallen.
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The amount of tokens held by the group for 1 week to 1 month – the group that usually trades in the strongest swing trade style – has decreased significantly, according to HODL Waves tool. This metric classifies holders based on the time they hold the tokens.
On November 29, 2023, this group controlled about 7.73% of the total Dogecoin supply. By December 23, 2023, that number had decreased to about 2.76%. This is a significant drop in speculative token holdings in a short period.
This is significant because this group often causes the market to sell off strongly when they panic. Once they finish selling, the forced selling pressure near the main support zone will ease.
Long-term investors are quietly buying more as coin activity declines.
While speculative token holdings have decreased sharply, the long-term holders group has begun to show signs of accumulation. The group holding from 1 to 2 years has increased its ownership percentage of Dogecoin from about 21.84% to 22.34%. Although the increase is small, this signal is very important.
These individuals typically only purchase more when they believe that the risk of a price decline has begun to lessen.
Token movement activity across the network, measured by the spent coins metric, also supports this assertion. This chart shows that the amount of spent coins has decreased sharply – from 251.97 million DOGE to 94.34 million DOGE. This means that token transfer activity has decreased by more than 60%.
The decrease in token conversion activity suggests that fewer retail investors are rushing to sell. Historically, such periods of declining activity often signal a short-term recovery for Dogecoin. At the beginning of December 2023, this stagnation previously led to a price increase from 0.132 USD to 0.151 USD, equivalent to an increase of nearly 15% in just 3 days.
While this does not guarantee that prices will rise significantly, it indicates that selling pressure is gradually decreasing instead of increasing.
Key Dogecoin price levels determine whether there will be a downtrend or recovery.
Currently, technical analysis shows that DOGE is maintaining within a relatively narrow price range. The 0.120 USD mark remains the most important support level in the short term. If any day's close ends below this mark, the price of Dogecoin is likely to continue declining deeper into the 0.112 USD range or lower if selling momentum increases.
In the opposite direction, if the price recovers, DOGE needs to break through the nearest resistance levels. When the price regains the 0.133 USD mark, the market will notice that selling pressure has eased. Especially if DOGE can surpass 0.138 USD, this will confirm that the buyers have regained control, and the recent decline was merely a temporary correction rather than the beginning of a larger downtrend.
Simply put, Dogecoin is currently at a decisive stage. The price structure remains quite risky, but on-chain data shows that speculative supply is leaving the market, long-term investors are beginning to re-enter, and overall coin activity is gradually decreasing. If the price maintains the support zone, these factors could help stabilize Dogecoin's price. Conversely, if the price loses support, the downtrend will continue to be confirmed.
