Should Dogecoin [DOGE] investors prepare for another selloff

Should Dogecoin [DOGE] investors prepare for another selloff


Veterans in the crypto industry by now are well-aware that the Dogecoin [DOGE] has been swimming in the deep waters for a much longer time than it has been around the shallow waters. And looking at the price performance of the token, one can presume that this streak may not end very soon.

Dogecoin’s next chapter…

…is not looking good. Primarily looking at the price indicators, DOGE is actually set for declining further on the charts, and this time, it isn’t faring much support from the community either.

The Bollinger Bands confirm the first sign of the same given the altcoin’s close movement below the basis, which provides hints of bearish influence on the coin.

However, DOGE might not observe a steep fall-off given the closeness of the bands, which exhibits low volatility, i.e., low chances of a price swing.

Secondly, the uptrend support it had from the Parabolic SAR is waning, and the indicator is on the verge of flipping into an active downtrend.

But there is some recoil from the Squeeze Momentum indicator, according to which this is the first appearance of bullishness in more than 45 days.

Dogecoin price action | Source: TradingView – AMBCrypto

However, in the past, too, this indicator hasn’t been fairly accurate in its prediction of an uptrend, as the green bars usually appear at the beginning of downfall and disappear into the bearishness.

Plus, given the state of the broader market’s fear, which has been peaking for almost a month now, it doesn’t seem like the minute bullishness is going to do much for the coin.

Crypto fear and greed index | Source: Alternative

As it is even before Dogecoin has begun falling, investors are trying to load off by selling their holdings before the worse comes to pass.

As per on-chain data, at the moment, there is a much higher sell offer active in the market than there are for buying, exceeding by a margin of more than 25 million ($2 million).

Dogecoin market selling | Source: Intotheblock – AMBCrypto

And in their defense, the move makes sense since the asset’s value has not only declined but is actually at its lowest point in forever.

Naturally, investors find no reason to hold on to Dogecoin, which is reflected in their behavior. If prices fall further, which may be the most natural outcome, investors would certainly be inclined to sell more.

Dogecoin market value | Source: Santiment – AMBCrypto


Source link

Share this post

Leave a Reply

Your email address will not be published. Required fields are marked *