Dogecoin price in danger of a full-blown reversal as the hype around DOGE fades away

In his last tweet about Dogecoin, Elon Musk gave an ultimatum to Dogecoin whales to vacate their positions. Musk believes that DOGE is great and will ‘fully support it’ if the concentration of large holders goes down. 

Interest in Dogecoin diminishes, but is this bad?

According to a recent report by Santiment, the social volume of Dogecoin has greatly decreased in the past two weeks after an initial peak, thanks to the first few Elon Musk tweets supporting the digital asset.

DOGE Social Volume

The interest in Dogecoin has certainly faded away but does that mean DOGE is bound to see another correction? According to the report, yes, because the social volume and trading volume have formed a clear divergence with the price.

This pattern, which doesn’t happen too often has reliably predicted tops in the past. Additionally, judging by the ultimatum of Elon Musk, it’s unlikely that we will see Dogecoin whales vacate their positions in order to decentralize the network more. 

Dogecoin price next step could be a fast run to $0.067

On the 9-hour chart, Dogecoin has established a descending parallel channel and just defended the lower boundary. The TD Sequential indicator has just presented a buy signal which gives the upper hand to the bulls in the short-term.

DOGE/USD 9-hour chart

A breakout above the key resistance level at $0.061 which coincides with the 26-EMA can quickly push Dogecoin price up to $0.067, a 10% move calculated by using the height of the pattern as a reference point.

DOGE IOMAP chart

However, the In/Out of the Money Around Price (IOMAP) chart suggests that a breakdown is more likely as there is a lot of resistance above $0.053 for Dogecoin. Only one key support area is located between $0.0489 and $0.05, losing this range can easily push Dogecoin rice down to $0.045.