While the volume of Dogecoin had exploded to 1 billion dollars, the cryptocurrency surprised the market with a sudden correction that trapped many bullish investors in a context of high volatility. As the asset price reached a local maximum of $0.2129, a rapid drop briefly took it down to $0.1973, triggering a series of cascading liquidations.
According to CoinGlass data, "long-position traders saw $594,130 vanish abruptly after an unexpected turn," meaning nearly $600,000 lost by those betting on the continuation of the rise.
This turn caused an impressive imbalance between long and short liquidations, marking extreme pressure. Here are the key data points to remember:
◽$594,130 in long positions liquidated in just 4 hours;
◽A 1,000% imbalance observed between long and short liquidations;
◽Short positions (short sellers) also suffered losses, but limited to $53,980;
◽The price drop from $0.2129 to $0.1973 was enough to trigger these movements.
This episode demonstrates the fragility of positions in highly volatile assets like Dogecoin, especially when they are heavily exposed to leverage. The optimism of bullish traders was wiped out in a few hours, and the market clearly punished those anticipating a linear rise without prior consolidation.
While the losses recorded in long positions are undeniable, other indicators suggest that the market has not fallen into a bearish scenario. When DOGE regained some balance around $0.2016, a 1.45% increase in 24 hours, trading volumes experienced a remarkable jump, increasing by 36%, reaching $3.36 billion.
This renewed interest could be explained by investors' desire to take advantage of low points to reposition themselves, or by the influx of new capital attracted by the current volatility.
At the same time, the activity of institutional investors and large holders also surged. Market activity increased by more than 300% after a previous rally, while whales accumulated the asset.
This accumulation phase by whales could indicate a different perception of the situation by more experienced players, who may see this correction as a buying opportunity rather than a signal of market exhaustion.
In an environment where on-chain data analysis and the behaviors of large holders can shape upcoming movements, this type of activity deserves to be under strict surveillance.
Finally, although historical precedents are not always favorable for DOGE, some observers believe that the month of July could end positively for the cryptocurrency. The increase in volume, combined with stabilization above the psychological threshold of $0.20, suggests a possibility of a rebound for the crypto if the momentum is maintained.
