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Dogecoin Faces Bearish Pressure After MVRV Death Cross
The crypto space is abuzz with the recent development in Dogecoin’s (DOGE) market performance. A disturbing trend has emerged, indicating a potential downward trajectory for the asset. The culprit behind this bearish pressure? None other than the MVRV ratio crossing below its 200-day moving average.
For those unfamiliar with the technical indicators employed by @ali_charts, allow me to provide some context. The MVRV ratio compares an asset’s current price to the average price paid by its holders. When it dips below its 200-day moving average, a red flag is raised, signaling that the asset may be overvalued.
In light of this information, it appears that Dogecoin has recently experienced this very phenomenon. The chart shared by @ali_charts showcases the stark reality: two instances where this MVRV ratio death cross led to price drops of 26% and 44%, respectively.
Currently, the MVRV ratio for DOGE sits at around 91.00%. With this ominous sign in place, there is a strong likelihood that the asset will continue along a downward path. The last two instances where this trend emerged were accompanied by significant losses for Dogecoin investors. Will history repeat itself?
Source: cryptonewsland.com
