Dogecoin price at risk of 70% correction as Elon Musk grows concerned about DOGE whales


  • Dogecoin price consolidates in an ascending triangle pattern awaiting a breakout.
  • A recent spike in selling pressure hints at a 70% correction ahead of DOGE.
  • Transaction history shows stable support at $0.055 that must hold to prevent further losses.

Dogecoin price seems to be breaking out of an ascending triangle in a downward direction after enduring a two-week-long consolidation phase. Further selling pressure could see DOGE's market value dive to $0.018

Dogecoin price on the verge of a steep correction  

In a recent tweet, the CEO of Tesla, Elon Musk, said that the levels of whales concentration on the network is the "only real issue" with this cryptocurrency. 

Data from IntoTheBlock shows that 16 addresses hold roughly 49% of 128.40 billion DOGE tokens in circulation. These whales have a disproportionate impact on prices because of their enormous holdings and their ability to coordinate buying and selling activity.

Musk stated that if DOGE whales were to sell most of their holdings, the meme token would get his "full support."

Following Musk's remarks, it seems like speculators rushed to exchanges to short Dogecoin. The spike in selling pressure pushed this altcoin towards the hypotenuse of an ascending triangle, where it has been contained over the past two weeks. 

By breaking through the $0.055 support level, the odds will increase for Dogecoin price to plummet by more than 70% towards $0.018.

DOGE 4-hour chart

DOGE 4-hour chart

IntoTheBlock's In/Out of the Money Around Price (IOMAP) model shows that the $0.055 support level poses a lot of significance to Dogecoin price. Here, approximately 1,800 addresses previously purchased 4.10 billion DOGE. 

A 4-hour candlestick close below $0.055 will send these investors "Out of the Money," and they might try to sell their holdings to avoid further losses.

Dogecoin IOMAP

Dogecoin IOMAP

It is worth noting that Dogecoin price must hold above $0.055 to invalidate the bearish outlook. If this were to happen, DOGE could reverse to retest the triangle's x-axis at $0.081. Moving past this barrier could catapult the meme token to a new all-time high at $0.143.


Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Recommended content


Recommended Content

Editors’ Picks

Is Altcoin Season here as Bitcoin reaches a new all-time high?

Is Altcoin Season here as Bitcoin reaches a new all-time high?

Bitcoin reaches a new all-time high of $98,384 on Thursday, with altcoins following the suit. Reports highlight that the recent surge in altcoins was fueled by the victory of crypto-friendly candidate Donal Trump in the US presidential election.

More Altcoin News
Shanghai court confirms legal recognition of crypto ownership

Shanghai court confirms legal recognition of crypto ownership

A Shanghai court has confirmed that owning digital assets, including Bitcoin, is legal under Chinese law. Judge Sun Jie of the Shanghai Songjiang People’s Court shared this opinion through the WeChat account of the Shanghai High People’s Court.

More Cryptocurrencies News
BTC hits an all-time high above $97,850, inches away from the $100K mark

BTC hits an all-time high above $97,850, inches away from the $100K mark

Bitcoin hit a new all-time high of $97,852 on Thursday, and the technical outlook suggests a possible continuation of the rally to $100,000. BTC futures have surged past the $100,000 price mark on Deribit, and Lookonchain data shows whales are accumulating.

More Bitcoin News
Shiba Inu holders withdraw 1.67 trillion SHIB tokens from exchange

Shiba Inu holders withdraw 1.67 trillion SHIB tokens from exchange

Shiba Inu trades slightly higher, around $0.000024, on Thursday after declining more than 5% the previous week. SHIB’s on-chain metrics project a bullish outlook as holders accumulate recent dips, and dormant wallets are on the move, all pointing to a recovery in the cards.

More Shiba Inu News
Bitcoin: New high of $100K or correction to $78K?

Bitcoin: New high of $100K or correction to $78K?

Bitcoin surged to a new all-time high of $93,265 in the first half of the week, followed by a slight decline in the latter half. Reports highlight that Bitcoin’s current level is still not overvalued and could target levels above $100,000 in the coming weeks.

Read full analysis
Best Forex Brokers with Low Spreads

Best Forex Brokers with Low Spreads

VERIFIED Low spreads are crucial for reducing trading costs. Explore top Forex brokers offering competitive spreads and high leverage. Compare options for EUR/USD, GBP/USD, USD/JPY, and Gold.

Read More

BTC

ETH

XRP