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Dogecoin miners have recently liquidated a large portion of their stakes, raising concerns over increased selling pressure on the cryptocurrency’s market.
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The rapid decline in miner reserves from 1.55 billion to 1.48 billion DOGE signals a significant shift that could impact price dynamics.
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As highlighted by Santiment, this sell-off raises questions about market sentiment and long-term price stability for DOGE.
This article examines the implications of the recent sell-off by Dogecoin miners on price dynamics and market sentiment, focusing on key resistance levels and potential future trends.
Massive miner sell-off: A bearish signal?
Santiment’s chart revealed that Dogecoin miners had reduced their holdings from approximately 1.55 billion DOGE to 1.48 billion DOGE in just a short span.
Source: Santiment
This sharp decline suggests that miners are liquidating their assets, possibly to cover operational costs or in response to market conditions. Historically, large miner sell-offs have led to downward price pressure as increased supply meets static or weakening demand.
DOGE price reaction: Resilient or vulnerable?
DOGE trades at $0.174 as of this writing, reflecting a minor decline following the miner dump. The 50-day moving average [$0.202] and 200-day moving average [$0.302] continued to act as strong resistance levels, further restricting upward momentum.
Moreover, the miner sell-off accelerated as DOGE’s price experienced a brief upward adjustment after a series of declines.
Source: TradingView
Despite the miner sell-off, accumulation among investors has remained stable, as indicated by the accumulation/distribution chart, which sat at 20.32 billion at press time. This shows that while miner activity adds to the selling pressure, broader market participants were still engaged in Dogecoin accumulation.
Will Dogecoin hold the support levels?
For Dogecoin to stabilize, it must hold above the $0.165 support level, a key zone where buying activity has historically stepped in. However, if selling pressure from miners persists, DOGE could revisit the $0.15 zone. Conversely, any increase in demand could see DOGE reclaim $0.18 before aiming towards the $0.20 mark.
Final thoughts
The miner sell-off injects volatility into DOGE’s price action, making near-term movements uncertain. While the price has not collapsed under pressure, traders should closely monitor further miner activity and key resistance levels. A break below $0.165 could trigger a sharper decline for Dogecoin, while a successful recovery above $0.18 would indicate resilience amidst miner exits.
Investors should remain cautious and keep an eye on shifts in on-chain data that could signal a change in trend.
