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The recent Dogecoin price rally appears to be losing steam following an impressive surge that pushed its price above $0.21 for the first time since April to mark a notable seven-month high. This intense week of upward movement has been followed by profit-taking by traders, which has triggered a pullback in the Dogecoin price. At the time of writing, the Dogecoin price has dipped below the $0.20 threshold again, bringing the idea of further price declines.
Adding to the concerns, on-chain data reveals a marked decrease in the volume of large transactions among Dogecoin holders. This drop in significant buying activity indicates waning enthusiasm from major investors, suggesting that the meme coin may face increasing pressure to hold onto recent gains.
Large DOGE Transaction Volume Crashes: Are Dogecoin Whales Selling?
Price action and on-chain data suggest Dogecoin traders are starting to take some profit after a week of intense price rally. Notably, on-chain analytics from IntoTheBlock (ITB) indicate that the volume of large Dogecoin transactions has dropped significantly, with a 36% decline observed in the past 24 hours.
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The shift could signal that major holders of Dogecoin are starting to reduce their exposure to the meme cryptocurrency after capitalizing on recent gains. This interesting trend is revealed through IntoTheBlock’s ‘Large Transactions Volume in USD’ metric, which tracks the collective value of transactions with a value of $100,000 or greater.
This ‘Large Transactions Volume in USD’ puts the value of large DOGE transactions at $3.46 billion in the past 24 hours, which represents a 36% decline in the $5.38 billion volume registered on November 6. Interestingly, this change in trend is particularly noteworthy considering the fact that the trading volume had been on an uptrend since November 2.
Similarly, the ‘Large Transactions Volume’ metric shows that 17.76 billion DOGE tokens were moved in 2.72 transactions in the past 24 hours. This also represents a 36% reduction in the 27.7 billion tokens moved in 4,150 transactions on November 6.
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What Does This Mean For Dogecoin Price?
Such a steep decline in both transaction volume and the number of large trades may reflect a shift in market sentiment as whales appear to exercise caution. However, the decrease in large transaction activity doesn’t necessarily indicate a widespread sell-off by big holders. It may simply reflect a pause in significant buying as whales hold back on adding to their positions in anticipation of a pullback.
That said, price data suggests some holders are indeed selling. At the time of writing, Dogecoin is trading at $0.1984 and it could soon attempt another push above the $0.20 mark. On the flip side, a breakdown of the momentum could see Dogecoin retesting support at $0.187.
Featured image created with Dall.E, chart from Tradingview.com
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