- Dogecoin (DOGE) price is trading within a bullish descending wedge pattern.
- The supply of DOGE is shifting from mid- and long-term holders to short-term holders, raising concerns about price stability and potential volatility.
- For DOGE to initiate a significant rally, it needs to overcome resistance at $0.128.
Dogecoin is currently trading within a bullish pattern, but the lack of positive investor sentiment and behavior may hinder the cryptocurrency’s ability to confirm the pattern and initiate a significant price rally.
The market is closely monitoring the dynamics surrounding DOGE, as its price movement could have implications for the broader altcoin market.
The Dogecoin price faces the risk of further decline on the daily chart, as the meme coin is experiencing a notable shift in the distribution of its supply among different types of holders.
DOGE is transitioning from the hands of mid- and long-term holders to those of short-term holders, raising concerns about the stability of the altcoin’s price.
Dogecoin Investors Exhibit Hesitancy and Concern
In the past month, the supply of DOGE held by short-term holders has witnessed a substantial increase, rising from 10.5 billion DOGE to 13.4 billion DOGE.
This significant growth highlights the growing trend towards short-term trading activity, which can potentially introduce heightened volatility to the market.
Short-term holders are typically characterized by their tendency to hold assets for less than a month, which is why the conditions for Dogecoin could turn increasingly bearish, as these holders are more likely to sell rapidly in response to market fluctuations.
Furthermore, DOGE investors have been displaying a lack of optimism, with the weighted sentiment remaining negative for nearly three months, reflecting a prevailing atmosphere of caution and pessimism among market participants.
This prolonged negative sentiment further reduces the chances of a recovery for DOGE’s price.
Without a notable shift in investor outlook and a surge in positive sentiment, the likelihood of reversing the current downtrend appears slim, as the market continues to grapple with uncertainty.
For DOGE to validate this pattern and initiate a significant rally, it would first need to overcome the resistance level at $0.128, which has been a persistent challenge for the meme coin.
While the descending wedge pattern suggests the possibility of a massive rally targeting $0.300, it is contingent upon a successful breakout.
