Dogecoin (DOGE) faced a sharp selloff on Tuesday, tumbling 8% to $0.1697 as whales unloaded $440 million worth of tokens. The move triggered a surge in trading volume and reinforced bearish market sentiment. According to on-chain data, institutional players off-loaded large DOGE holdings, signaling a continuation of the selling pressure that began in late October.

The breakdown below the key $0.18 level confirmed a shift in market structure, suggesting sustained distribution from high-value wallets and a fading appetite for risk across the altcoin market. The correction also erased recent weekly gains, leaving traders on alert for potential further downside.

Breakdown Below $0.18 Confirms Structural Weakness

Dogecoin’s decline from $0.1843 to $0.1697 over 24 hours marked a clear structural failure. The price fell through multiple support zones, reaching new monthly lows as selling momentum intensified. Trading volume surged 426% above its daily average to 3.37 billion DOGE, underscoring the depth of liquidation flows that accompanied the drop.

The fall followed a failed defense of the 0.236 Fibonacci retracement at $0.1787 — a critical technical level often watched by traders. Once DOGE slipped below this threshold, automated liquidations and algorithmic trading systems accelerated the selloff, pushing prices toward intraday lows of $0.1641 before modest dip-buying offered temporary support.

Market flows turned notably negative, with on-chain data showing $22.27 million in daily outflows from major wallets. Futures turnover climbed 50% to $5.25 billion, but open interest declined 4% to $1.67 billion, suggesting traders were closing positions rather than opening new speculative bets.

Technical Structure Shows Bearish Continuation

The technical picture remains bearish for Dogecoin following the breakdown through the $0.18 support area — a level defended since early October. Sellers consistently absorbed buying attempts at each intraday rebound, confirming a descending-channel continuation pattern.

Data showed the heaviest wave of selling occurred between 03:00–05:00 UTC, with trading volumes peaking above one billion DOGE during that window. Attempts to reclaim the $0.1760 resistance were quickly rejected, and the session ultimately closed near the lower end of its range. This pattern highlights the persistent control of institutional sellers and the lack of momentum among buyers.

Whale Activity Signals Broad Distribution

Whale behavior further supports the bearish case. Wallets holding between 10 million and 100 million DOGE dumped approximately 440 million tokens over the past three sessions — marking one of the largest liquidation phases by mid-tier investors this quarter. Such selling behavior often precedes extended consolidation periods, as liquidity providers and larger traders realign their portfolios.

The rapid reduction in whale holdings also points to growing caution in the broader altcoin market, as institutional participants take profits or reduce exposure amid rising volatility.

Momentum Indicators Show Oversold Conditions

Despite the bearish setup, some analysts see potential for a short-term technical bounce. Dogecoin’s relative strength index (RSI) dropped to 34.7, nearing oversold territory that has historically preceded temporary relief rallies.

However, the descending channel remains intact, suggesting that any recovery may face strong resistance near $0.1760–$0.1800. The next major demand zone lies between $0.165 and $0.150, where previous accumulation took place in mid-September. If DOGE falls below $0.165, further declines toward $0.150 could be likely before stabilization occurs.

What Traders Should Watch Next

Dogecoin’s immediate outlook depends on its ability to hold above $0.165 in the short term. Analysts note that DOGE often experiences 6–9% single-day drawdowns, followed by minor technical rebounds. Still, a decisive daily close above $0.18–$0.185 is needed to neutralize bearish momentum and reestablish a bullish setup.

Short-term traders are treating rallies toward $0.1760–$0.1800 as opportunities to exit or short positions unless broader market sentiment improves. With leverage being unwound and whale flows turning negative, the near-term bias remains tilted to the downside.

Until trading volumes decline and price action stabilizes above $0.165, Dogecoin may continue to face volatility as the market seeks a new equilibrium. For now, traders are advised to monitor key support zones and wait for confirmation of a reversal before anticipating a sustainable recovery.