Analyzing DOGE’s performance amid Musk’s withdrawal from Twitter takeover

The status of the meme coin was one of the key driving factors behind Dogecoin. [DOGE] hit in 2021. Fast-forward a year later and it’s not as hyped anymore. However, the coin has received a lot of support from Tesla CEO Elon Musk, but the latest events could cast a dark cloud over DOGE.

Elon Musk has reportedly opted out of the plan to acquire Twitter’s microblogging platform. How does this affect Dogecoin? Well, the Tesla king of techno has previously expressed his support for the meme coin. As soon as Musk submitted his offer to acquire Twitter, there was speculation that he would make Dogecoin the microblogging platform’s official currency.

Dogecoin’s fate is once again shrouded in a cloud of uncertainty now that Musk has withdrawn his takeover plans from Twitter. DOGE’s price action had not responded negatively at press time, hours after Musk’s exit from the deal was announced. In fact, Dogecoin saw a slight rise in the last 24 hours. It traded at $0.069 at press time after rising 0.73% in the last 24 hours.

Source: TradingView

DOGE price action delivered a mixed performance in the first week of July after a strong rally since mid-July. Its Relative Strength Index (RSI) has been hovering around 50%, while the Money Flow Index (MFI) saw some outflows. This was to be expected, especially after the price briefly moved into the IMF distribution zone above 80.

Behind the scenes

Despite the slight upside, many investors remain cautious about DOGE’s performance. There was a noticeable drop in 24-hour active addresses from 133,670 to 128,960 addresses between July 8 and July 9. Whale transactions also saw fewer actions, going from 21 whales on July 7 to 5 whale transactions on July 8.

DOGE’s supply distribution reveals a tug-of-war between different categories of whales. For example, addresses holding between 1 million and 10 million DOGE have been sold since June 26, while addresses holding between 10,000 and 1 million Dogecoin have been accumulating over the same period.

Source: Sentiment

Addresses containing more than 10 million coins saw the least activity over the past two weeks. Their balances increased slightly and this is important because it means they have not been selling their holdings heavily. This is good for DOGE’s upside potential and may explain why its price saw a slight increase.

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