The recent Dogecoin whale deal has raised concerns about the next direction of the DOGE price. While large transactions are nothing new to the leading meme currency in the space, it is the destination of the transaction that matters.
Dogecoin whale sends $5 million to exchange
at recent days practical Tagged by the Whale Alert tracker, the Dogecoin whale has made a massive transfer of tokens to a centralized exchange. The transaction held a total of 67,881,717 DOGE tokens, which were valued at more than $5 million at the time of the transfer.
As explained by the on-chain tracker, the transaction was going towards Coinbase, a centralized crypto exchange. This destination could help to see why the whale made this trade and perhaps what kind of impact it could have on the price of DOGE.
One of the reasons investors move currencies from their personal wallets to centralized exchanges is to sell. This is because centralized exchanges offer higher liquidity, especially for large investors, and the fees on these exchanges are often lower.
If this is the main reason why Dogecoin whales are moving coins to Coinbase, DOGE price is likely to feel some selling pressure as whales unload their holdings.
DOGE bulls still holding $0.075 support | Source: DOGEUSDT on Tradingview.com
Will DOGE drop to $0.7?
While such a massive sell-off would certainly put selling pressure on Dogecoin, the effect is likely to be short-lived. One of the reasons for this is that the DOGE indicators keep flashing bullish. This is shown across both the 50-day and 100-day moving averages. Since investors are still willing to buy the cryptocurrency at a higher price than they have in the past few months, demand is likely to rise to meet this supply.
This means that DOGE, especially in the short term, is likely to maintain its current level. A decline of 5%, at most, is expected before DOGE picks up momentum again. In this case, the bulls would still be in charge even as such large sales occurred.
The $0.075 support is expected to hold until the end of the week. However, the low momentum that often characterizes the weekend markets could see the price swing either way. But such a move still depends heavily on what market leader Bitcoin (BTC) does as well.
At the moment, the price of DOGE is holding steady at $0.07545, recording a precise loss of 0.06% in the last 24 hours. In contrast, the meme coin is holding its weekly gains, up 3.06% in this time frame.
