The cryptocurrency market has recently shown signs of recovery, and Dogecoin is no exception. This meme coin has risen over 16% in the past week, but yesterday it moved sideways.
Some on-chain and chart signals suggest that sellers may be preparing to take profits, leading to a stall or short-term pullback. Whether DOGE continues to rise or starts to drop depends on a key support level.
Profit-taking Pressure Rises, Inflow of Capital Supports
The percentage of profitable DOGE addresses has recently reached 84%; a level similar to July 27 before the price dropped from $0.24 to $0.19 in just one week. Traditionally, when too many holders are in profit, some tend to cash out.
To illustrate this, the net inflow on exchanges shifted from -$52 million on August 10 to +$2.7 million on August 11. More DOGE is being moved to exchanges, often a sign that traders are preparing to sell.
SOPR Suggests a Cooldown, Led by Profit-Takers
The Spent Output Profit Ratio (SOPR) indicates whether the cryptocurrency being sold is at a profit or loss. A reading above 1.0 means holders are realizing profits.
On August 10, DOGE's SOPR index rose to 1.045, close to the level recorded at the end of July, followed by rapid corrections. This is a sign that the market may be approaching another short-term cooldown point. Furthermore, the rising SOPR aligns with selling activity.
Important Levels on the Chart May Determine What Happens Next for Dogecoin's Price
On the 4-hour chart, DOGE price is fluctuating around $0.235, just below the descending trendline of the bearish triangle pattern. This pattern typically has a downward bias in shorter time frames, signaling consolidation rather than a breakout.
Fibonacci levels act as the base of the descending triangle, represented as key support levels. Dogecoin's price has surpassed several resistance levels around the $0.23 mark. If the $0.235 level is broken, traders may need to pay attention to the following signs:
Support level to watch: $0.22 — This level has held previously. If it holds again, buyers may step in.
If broken, Dogecoin's price could drop to lower levels.
Triggering factor for an upward trend: Breaking through the $0.24–$0.246 level will break the triangle pattern and create an opportunity for buyers to push the price above $0.25.
Breaking the $0.24 level will invalidate the bearish triangle pattern and maintain bullish momentum. Currently, the $0.22 threshold could determine whether DOGE continues to rise or sees more red candles.