Since Hitting a Local High of $0.16, Dogecoin [DOGE] Has Struggled to Maintain Any Upward Momentum

Since recovering to hit a local high of $0.16 on the charts, Dogecoin [DOGE] has struggled to maintain any upward momentum on the charts.

In fact, over the last 48 hours alone, the memecoin dropped from $0.16 to a local low of $0.157. At the time of writing, Dogecoin was trading at $0.159 after a 2.71% 24-hour decline.

These struggles on Dogecoin’s price charts have created a buying window, especially for large entities. Hence, whales have entered the market over the past 2 days to aggressively accumulate the memecoin.

According to Ali Martinez’s analysis of Santiment, Dogecoin whales have bought more than 800 million DOGE tokens in just 24 hours.

Often, a hike in accumulation by whales is seen as a bullish signal. When whales turn to accumulating, it reflects strong confidence in the market. What this means is that whales are viewing the current rates as affordable enough to take a position, before DOGE becomes more expensive.

Usually, whale buying activity incentivizes other market players, especially retailers, to also buy.

For instance, a look at Dogecoin’s spot netflows indicated that even other participants are now buying the memecoin. Its spot netflows have remained negative over the past 10 days – A sign of higher buying activity.

Additionally, Dogecoin’s Futures sell volume declined over the past week from $3.43 billion to $238.4 million. A fall in Futures sell volume implies that fewer investors are placing aggressive sell orders.

This means that short sellers are exiting the market, reflecting a loss of confidence in the likelihood of more downside. Historically, a fall in selling pressure has preceded higher prices on the charts.

What next for the memecoin?

Although Dogecoin is seeing aggressive buying from large holders, the downward momentum is still strong.

We can see this downward momentum, especially after the recent bearish crossover. Over the past 24 hours, Dogecoin’s Stoch RSI made a bearish crossover with the Signal line – Hitting a high of 86.9.

This crossover suggested that DOGE has been experiencing strong downward pressure and hence, could see its downtrend continue.

Therefore, although buyers may be back in the market, DOGE could drop before another leg up.

Thus, if the downtrend continues, the memecoin could drop to $0.156 before attempting another upward move. However, with buyers returning to the market, if their input starts to reflect, Dogecoin could make a strong upswing move to $0.170.