Dogecoin (DOGE) has surged practically 100% quarter-to-date (QTD) on hopes that Elon Musk would combine the token onto the Twitter platform. However, DOGE’s potential to proceed its uptrend within the coming weeks is low, one standard market analyst argues.
Short Dogecoin arduous?
Independent, pseudonymous market analyst GCR mentioned he’s reasonably quick on DOGE primarily based on its worth’s current response to a Musk tweet. Notably, DOGE fashioned an area prime at $0.158 on Nov. 1. The identical day, Musk shared an image of his pet Shiba Inu sporting a t-shirt with the Twitter brand.
pic.twitter.com/eaIYaDRBnu
— Elon Musk (@elonmusk) November 1, 2022
GCR argues that the Musk impact is sporting off relating to Dogecoin’s potential integration into Twitter, that means that many of the good points are already priced in. Therefore, if the precise integration occurs, it can probably turn out to be a sell-the-news occasion.Â
canine inventory solely has 2 bullets
bullet 1 – musk tweeting/teasing about integration; already fired
bullet 2 – official integration into twitter; hasn’t shot, however could be promote the information
i am reasonable quick on doggo, however leaving room open to quick tougher in the event that they fireplace 2nd bullet
— GCR (@GCRClassic) November 3, 2022
Overbought correction begins
Meanwhile, Dogecoin continued its correction transfer on Nov. 4, three days after topping out at $0.158.
DOGE’s worth dropped to as little as $0.115 on Nov. 4, partially because of rumors of Twitter pausing its crypto pockets growth undertaking. That introduced the token’s web proportion correction from the Nov. 1 native prime to almost 27%.
In addition, the draw back transfer surfaced because of its extraordinarily overbought situations with the very best relative energy index (RSI) since April 2021.
The correction has prompted Dogecoin worth to retest its December 2021-May 2022 assist (outlined by the $0.108-$0.124 vary, the pink bar within the chart above) for a possible pullback. The coin could attain $0.185, a stage coinciding with its 0.236 Fib line, if the restoration happens.
Conversely, a break beneath the $0.108-$0.124 vary might have DOGE drop to $0.055 as its major draw back goal, down 55% from present worth ranges.
DOGE on-chain information
Furthermore, Dogecoin’s on-chain information reveals a constant drop in key metrics getting into November, which might add extra sell-pressure.
Related: Shiba Inu worth drops to file low vs Dogecoin — Will historical past repeat with a 150% rally?
For occasion, DOGE’s Twitter-led worth rally coincided with a pointy rise in whale transaction depend (value over $100,000), suggesting that they supported the upside transfer. But after Nov. 1, fewer whales have interacted with the Dogecoin community.
Meanwhile, the Dogecoin provide distribution throughout addresses holding between 1,000 and 10 million DOGE tokens has fallen alongside the worth. Conversely, the availability managed by addresses holding greater than 10 million DOGE tokens has elevated modestly.
In addition, the addresses holding beneath 100 DOGE have been growing, hinting that retail buyers have been offsetting whales’ promoting strain to a sure diploma.
The views and opinions expressed listed below are solely these of the writer and don’t essentially mirror the views of Cointelegraph.com. Every funding and buying and selling transfer entails threat, it’s best to conduct your personal analysis when making a call.