Crypto analyst Ali Martinez has issued a warning for Dogecoin holders. A concerning technical pattern has emerged in DOGE’s Market Value to Realized Value (MVRV) ratio. The indicator suggests a potential price drop of up to 40%.
Understanding the MVRV Death Cross
The MVRV ratio has formed a death cross with its 200-day moving average. This rare event has historically preceded major price corrections. The last two occurrences led to drops of 26% and 44%.
Technical Analysis Deep Dive
DOGE currently trades at $0.26, down from its December high of $0.4834. The price action shows a clear downtrend. Lower highs and lower lows dominate the chart pattern. The MVRV ratio sits at 91%, while its 200-day MA hovers at 78.36%.
Key resistance levels lie ahead:
- $0.31 (0.382 Fibonacci level)
- $0.342 (0.5 Fibonacci level)
- $0.375 (0.618 Fibonacci level)
- $0.44 (Major resistance)
Market Implications
The high MVRV ratio suggests significant unrealized profits among holders. This could trigger a sell-off if investors rush to secure gains. Bulls need a decisive break above $0.44 to invalidate the bearish setup.
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Looking Ahead
Traders should watch the $0.26 support level closely. A break below could accelerate the downward momentum. However, the previous corrections eventually led to rebounds. This suggests a potential buying opportunity after the predicted drop.
Tags: #Dogecoin #DOGE #CryptoTrading #TechnicalAnalysis #MVRV
Source: NewsBTC