Dogecoin (DOGE) Long-Term Holders Might Be Preparing to Cash In, But Will the Market Absorb the Increased Supply?

Dogecoin's Age Consumed, which tracks the movement of long-held coins, skyrocketed by over 3000% on Thursday, reaching 1.02 trillion —its highest since June 2023.

Holders of Dogecoin (DOGE) who have maintained their coins for an extended period may now be preparing to cash in, as evidenced by a significant movement in DOGE coins that have been held for prolonged durations. This suggests a shift in sentiment among these long-term investors, prompting BeInCrypto to analyze the potential outcomes arising from the movements of these previously dormant coins.

According to on-chain data, Dogecoin’s Age Consumed, which tracks the movement of long-held coins, experienced a meteoric spike on Thursday. This metric, which measures the total age of all coins moved multiplied by the quantity transacted, reached 1.02 trillion — its highest level since June 2023.

This metric indicates the total "age-days" of the coins that were consumed in a transaction. For instance, if a coin that has been held for 300 days is moved in a single transaction, it will add 300 to the Age Consumed metric.

When an asset's age consumed spikes, it usually signifies that coins or tokens that have been dormant for a long time have recently been moved or traded. Typically, the reactivation of sleeping coins signals renewed interest from long-term holders, which many perceive as a bullish indicator.

However, for this bullish trend to play out, the influx of newly circulated coins must be met with sufficient demand to absorb the increased supply.

An assessment of the DOGE/USD 12-hour chart reveals that no such demand is present in the market as of this writing. Its on-balance volume (OBV) is in a downtrend and is positioned at 507.90 billion. When an asset's OBV is in a downtrend, it typically indicates that the selling pressure exceeds the buying pressure.

Furthermore, the meme coin's negative Balance of Power (BoP) confirms that demand for DOGE is low. This indicator, which measures the strength of buyers versus sellers in the market, is at -0.34 at press time. A negative BoP suggests that sellers are in control and attempting to push the asset's price downwards.

As a result, the technicals on the 12-hour chart suggest that the selling pressure on DOGE might lead the coin's price to the next major support level with a potential 41% decline from its current price.

As of this writing, Dogecoin's price is encountering resistance at the 50-12 EMA Fib level at $0.13. A decline below this level will shift the meme coin's focus to the next major support formed at $0.11. If this level fails to hold, Dogecoin's price may drop to $0.08, representing a 41% decline from its current price.

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