Coin World Report:
Is Dogecoin on the brink of a bearish retracement after its recent rebound?
On-chain data shows sustained demand, despite signs of potential profit-taking.
Dogecoin [DOGE] has had its most optimistic two weeks in months.
However, its impressive performance has ventured into overbought territory, raising questions. Should traders take short-term profits or wait for more potential gains?
As of the time of writing, Dogecoin’s trading price is $0.145, up 41.95% from its lowest point in October.
In other words, the Dogecoin bulls have been busy launching a strong attack against the bears.
But will the Dogecoin bulls take a break? Based on historical performance, the meme coin king is expected to face resistance above the $0.141 price range.
The bulls broke through this price point, but in the past three days, they have clearly faced greater difficulties in maintaining momentum above this price.
DOGE’s RSI is already in overbought territory, indicating a cooling bullish momentum.
Similarly, a minor decline in institutional money flows after overbought conditions suggests some traders are starting to take profits.
Despite increasing resistance, the bulls continue to show resilience, with no rush to take profits.
This suggests that a majority of Dogecoin holders anticipate further price increases. As of the time of writing, DOGE’s price is noticeably below the year-to-date high.
Will Dogecoin trigger profit-taking?
Data from IntoTheBlock suggests that at the current price level, 80% of Dogecoin holders are in profit.
Only 16% are in the red, indicating significant demand within the range near the bottom.
Large fund flows rebounded from 27.45 million DOGE on October 20 to 108 million DOGE on October 21, indicating strong bullish momentum.
On the other hand, outflows from large holders rebounded from 52.23 million to 39.22 million during the same period. This confirms a significant increase in selling pressure from whale-like entities.
However, the inflow of funds into large holder accounts is noticeably higher, explaining why the price has maintained recent gains.
Assessment of Dogecoin exchange flows also shows that the peak outflow reached 422.56 million DOGE on October 21. Inflow is slightly lower at 371.71 million DOGE.
Whether real or not, this is the market value of DOGE under BTC conditions.
However, AMBCrypto pointed out that on October 18, there was a significant increase in inflows, surpassing outflows during the same period.
This is the first possible indication of increased selling pressure. However, since then, outflows have once again dominated inflows.
