Dogecoin Miners Deplete Holdings by 350 Million Coins
After a period of stagnation, Dogecoin miners have started selling off some of their block rewards, depleting their balances for the third consecutive month. In July, miners held 4.7 billion DOGE, but that number has decreased to 4.35 billion DOGE as of September 28. This means they have sold off 350 million coins in just three months. When benchmarked against the current market price of $0.061, this equates to $21.5 million worth of coins sold since July 11. With miners controlling about 3.08% of the total DOGE in circulation, if they continue selling in October, it could lead to a significant downswing.
Whale Investors Reduce Trading Activity
Data also shows that whale investors in Dogecoin have been reducing their trading activity, confirming bearish price predictions for DOGE. The number of unique large transactions peaked at 819 on July 25 but dropped to just 79 on September 28. A decrease in whale transactions typically indicates lower market liquidity and can make trading less efficient for participants. The combination of miners flooding the market and the downtrend in whale transactions could further drive down Dogecoin prices in October and beyond.
$0.05 Support Level at Risk
The lack of movement in DOGE prices raises concerns about a prolonged bearish reversal below the $0.05 support level in the coming weeks. The In/Out of Money Around Price data supports this narrative, indicating that there is a considerable obstacle around the $0.05 territory. However, if the bullish holders who bought at higher prices defend their positions, DOGE may avoid a bearish downswing. On the other hand, if miners continue selling, Dogecoin’s price could potentially drop below the $0.05 support level.
Hot Take: Dogecoin Faces Uncertain Future
The outlook for Dogecoin remains uncertain as miners deplete their holdings and whale investors reduce their trading activity. The potential downswing in prices raises concerns about the long-term viability of DOGE. While there is a resistance level at $0.07 that could invalidate the bearish prediction, it may prove challenging for the bulls to reclaim that price if miners continue selling. Ultimately, the future of Dogecoin will depend on various factors, including market dynamics and investor sentiment.
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