The price of Dogecoin (DOGE) has fallen more than 24% after reaching a multi-month high of $0.28 on July 21. Consequently, the largest holders of this memecoin have started to sell off during recent price declines, indicating a lack of confidence in recovery in the coming weeks.
DOGE's on-chain indicators suggest a potential continuation of losses.
Investor interest in DOGE remains low based on derivative data. The open interest (OI) of DOGE futures contracts has dropped to $3.24 billion after peaking at $5.35 billion on July 22. The 8% decrease since Sunday indicates reduced speculative positions and fewer traders betting on short-term price increases.
Data from Santiment shows that wallets holding 10–100 million DOGE have decreased by 6% since the end of July.
Notably, a transaction was flagged by Whale Alert, where 900 million DOGE, worth over $200 million, was transferred by an unidentified whale to Binance, raising concerns about short-term selling pressure.
Typically, when large holders distribute assets during a price decline, it indicates they perceive a risk of continued decline.
Meanwhile, the number of daily active addresses on the Dogecoin network has sharply declined to 58,000, compared to a peak of 1.65 million in Q4 2024 and 674,500 in July, signaling weak network activity.
The decrease in active addresses indicates a reduction in user interaction on the network, which may reflect weakening interest from retail investors.
The upward wedge pattern of DOGE targets $0.12.
From a technical perspective, selling pressure on DOGE could increase sharply if the price breaks the upward wedge pattern.
In technical analysis, an upward wedge is a bearish reversal pattern consisting of two converging trend lines connecting higher highs and higher lows. This convergence indicates that the bulls are gradually losing momentum.
Currently, the price of DOGE is retesting the support level provided by the lower trendline of the wedge at $0.218.
If this level is broken, it is highly likely that the price will drop further, with the technical target of the wedge being $0.12, equivalent to a 45% decrease from the current price.
The relative strength index (RSI) also shows signs of weakness, dropping to 49 from an overbought state of 85 on July 20, indicating that bearish momentum is gradually increasing.
The price of DOGE must hold above the $0.19–0.20 range, or the 100-day and 200-day moving averages, to avoid further losses towards $0.16.
