Dogecoin (DOGE) is down 11% on Friday, May 30, recording the biggest loss among the top ten largest cryptos by market cap. The steep decline in Dogecoin price coincides with heavy whale selling activity as these large addresses sell 60 million tokens in the last two days.
The ongoing DOGE selloff follows a crash across the broader crypto market that has wiped out more than $700 million within 24 hours, according to Coinglass data. At press time, Dogecoin trades at $0.204, its lowest level since May 10.
Dogecoin Price Crashes as Bulls Lose Control
Dogecoin price is crashing amid intense selling that has led to bulls losing control. This selling pressure stems from $21 million in DOGE long liquidations at press time. The 50% spike in Dogecoin’s trading volumes per CoinMarketCap also signals high selling activity.
Following the ongoing decline, Dogecoin has made a bearish breakout from the consolidation range between the $0.21 and $0.24 price. This top meme coin has been trading within this range for nearly three weeks amid market uncertainty following capital rotation from altcoins to Bitcoin after the latter hit an all-time high.
The recent price crash also coincides with a bearish crossover between the 20-day EMA and the 200-day EMA. This usually signals a trend reversal from bearish to bullish and a continuation of the ongoing bearish trend.
The red AO histogram bars further depict the weakening short-term momentum as they shrink in size, which is a sign that bulls are losing control. The AO has been dropping since May 10, coinciding with a slow but gradual decline in Dogecoin price.
As the bearish momentum depicted by technical indicators grows, Dogecoin’s next support level lies at $0.17. Conversely, the immediate resistance level lies at the upper boundary of the consolidation channel, which is $0.24.
If Dogecoin falls to $0.17, it will align with a recent Coingape analysis, which noted that Dogecoin needs a 20% correction to $0.179 before the next bullish leg to $1.
Whales Dump 60M DOGE
In the last two days, large Dogecoin addresses holding between 100 million and 1 billion tokens have reduced their holdings from 26.55 billion to 26.49 billion DOGE. Hence, these whales have sold 60 million tokens in the last two days, equivalent to $12 million at the current Dogecoin price.
Looking at past data, Dogecoin whales tend to sell during and before price crashes, and accumulate when the price is on the verge of a major rally. Therefore, this selling activity supports the bearish technical outlook of a price decline to $0.17.
In summary, Dogecoin price is crashing because of the bearish outlook in the broader market, which has caused a surge in long liquidations. Whales have also dumped 60 million tokens within two days, and if history rhymes, this activity may indicate further dips ahead.