- A surge on the social front might help DOGE’s price action
Ownership stats underlined growth on some fronts too
As a seasoned crypto investor with a knack for spotting trends, I find myself intrigued by the recent developments surrounding Dogecoin. The surge in social activity and sentiment around this memecoin is undeniably reminiscent of the hype that propelled it to unprecedented heights back in 2021. While I’m not betting my house on another moonshot, I can’t help but feel a hint of nostalgia.
2024’s Q1 saw Dogecoin make a strong start, but it has since lost most of its yearly gains. Interestingly, the memecoin sector as a whole has been thriving this year. Surprisingly, recent data suggests that social interest is gradually growing for the leading memecoin.
There’s a growing buzz surrounding Dogecoin, as indicated by LunarCrush. The coin’s social media activity is comparable to heavyweights like Bitcoin, Ethereum, and Solana. This could suggest that Dogecoin enthusiasts are actively trying to generate interest in the meme-based cryptocurrency.
The surge in Dogecoin’s social activity is quite relevant, given that the cryptocurrency’s current prices are significantly lower than its year-to-date highs. For instance, at $0.097 during this moment, it represents a 57.25% decrease from its projected 2024 peak. Moreover, Dogecoin has been confined within a wedge formation, and the boundaries of this pattern are now approaching a potential breakout point as well.
Combining price trends with growing public enthusiasm for Dogecoin seems to indicate potential benefits from increased funds flowing into it. Yet, this doesn’t automatically mean an upward surge will occur. Instead, the price could continue falling if there’s more deterioration in investor trust.
Assessing Dogecoin’s bullish confidence and holdings
Analysis of transactions on the blockchain shows a high volume of sellers (short positions) within the current price range, with approximately 2 million such trades recorded over the past day. The price had been moving towards a strong resistance level around $0.099 in the last week before this drop.
Even with a high number of shorts present, an equivalent amount or more of long positions was observed. At the same $0.099 price point, the figure for net longs reached a maximum of $4.16 million. This suggests that the recent low prices have stimulated increased bullish sentiment among traders.
Nevertheless, the presence of shorts still underscores the possibility that price could dip lower.
The significantly reduced cost of DOGE recently has probably drawn in more people buying and holding it as an investment. Furthermore, there’s been a noticeable increase in Dogecoin ownership over the past four weeks, according to the latest statistics.
On the 5th of August, whales owned approximately 64.47 billion DOGE, which represented around 41.49%. Fast forward a month, and the amount of DOGE held by these whales increased to 65.39 billion, equating to roughly 41.73%.
It’s been observed that retail traders have been steadily increasing their Dogecoin (DOGE) holdings. For instance, they possessed approximately 58.44 billion DOGE, which accounted for 37.7%, on August 5th. Since then, their holdings have expanded to 59.24 billion DOGE, equating to 37.8% of the total supply.
Instead of adding to their holdings, institutions actually reduced the number of Dogecoin they owned. On the 5th of August, investors were holding about 32.51 billion Dogecoins. However, by the end of the following month, this amount had decreased to approximately 32.08 billion DOGE.
These ownership stats confirmed that Dogecoin whales and retail have been accumulating, albeit moderately. It will be interesting to see how improving social sentiments will influence Dogecoin’s demand in the next few days and weeks.
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2024-09-07 03:03