Dogecoin’s (DOGE) price has remained muted despite an increase in coin accumulation, as shown by its rising Money Flow Index (MFI).
The leading meme coin continues to trade within a horizontal channel, indicating that the buying pressure may not yet be strong enough to trigger a breakout.
Dogecoin Demand Needs More Momentum
DOGE’s MFI, which measures the flow of money into and out of the asset, has been in an uptrend over the past few days. Generally, a rising MFI signals a spike in the demand for an asset.
However, DOGE’s sideways movement over the past few weeks suggests that this demand has not been strong. This makes the rally past the upper line of the horizontal channel, which forms resistance at $0.11, challenging.
Falling whale activity supports this outlook. On-chain data reveals a gradual drop in the daily count of whale transactions valued above $100,000 and $1 million.
Moreover, DOGE’s large holders’ netflow has plummeted by over 112% over the past month, signaling a high volume of coin distribution among investors that hold at least 0.1% of the coin’s circulating supply.
Read more: How To Buy Dogecoin (DOGE) and Everything You Need To Know
DOGE Price Prediction: A 14% Price Decline Is Possible
With low whale activity, DOGE’s attempt to rally past the resistance level may be hard. A failed test of this level will cause the meme coin’s price to trend toward support at $0.10.
If the bulls fail to defend this critical level, the downtrend will continue, and DOGE’s value may plunge by an additional 14% to trade at its August 5 low of $0.08.
Read more: 10 Best Altcoin Exchanges In 2024
However, if demand strengthens, the coin will successfully rally past resistance and target the three-month price high of $0.15.
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