Dogecoin Price Is Rising Despite Negative Onchain Metrics

A look into Dogecoin's on-chain metrics shows an altcoin struggling to remain afloat. Data from Santiment shows the price-DAA (Daily Active Addresses)

Dogecoin price recently abandoned a breakout after the entire crypto market crashed following uncertainty from the Middle East conflict. However, as the Bitcoin price shows a mild recovery to $61,200, other altcoins, including DOGE, are rallying. But, on-chain metrics show the Dogecoin price is headed for a 12% drop.

Dogecoin Price Is Rising Despite Negative Onchain Metrics

A look into Dogecoin’s on-chain metrics shows an altcoin struggling to remain afloat. Data from Santiment shows the price-DAA (Daily Active Addresses) divergence has dropped to a three-month low of -66%. The price-DAA divergence shows the relationship between a cryptocurrency’s price and its network activity.

A divergence of -66% indicates a significant drop in network activity relative to the price, suggesting that the price increase is not supported by a corresponding increase in user activity. This could be a sign of a weakening market sentiment, which is a bearish signal on the Dogecoin price.

Further, the NVT (Network Value to Transactions) ratio also spiked to a three-month high of 397.32. The NVT metric measures the relationship between market capitalization (network value) and transaction volume, and a spike, especially to a 3-month high while the price is down, indicates the network value is high relative to transaction volume.

This suggests that Dogecoin may be overvalued, which could cause its price to drop further. On the other hand, it could also mean that investors are holding on to their DOGE rather than transacting.

Despite the negative on-chain metrics, the DOGE price today is $0.1081, representing a 2.6% increase in the last 24 hours. Dogecoin price analysis shows this may not be the case for long.

DOGE Price Analysis: Brace for $0.095

DOGE price action is neutral to bearish. The chart indicates a potential reversal following a fake out above the neckline of a double bottom pattern. The price attempted to break out but quickly fell back below the 0.1150 resistance level. The price is currently trading slightly above the 50-day exponential moving average (EMA) but the fake-out signals a bearish sentiment.

Key Support and Resistance Levels

If the DOGE price action forms a strong base at $0.0950, it may present a long-term buy opportunity. However, Dogecoin price prediction shows if the asset surges and breaks above the neckline, it would show market strength, retest $0.13 or higher, and invalidate the bearish thesis.

Dogecoin price analysis shows the asset is headed for a 12% drop from the current price levels. However, if the price manages to hold above the 50-day EMA, it could still attempt to reach $0.13 or higher.

Frequently Asked Questions (FAQs)

1. What is the significance of the price-DAA divergence for Dogecoin?

The price-DAA divergence for Dogecoin shows a measure of the relationship between the asset’s price and its network activity. A divergence of -66% indicates a significant drop in network activity relative to the price, suggesting that the price increase is not supported by a corresponding increase in user activity. This could be a sign of a weakening market sentiment, which is a bearish signal on the Dogecoin price.

2. Is there still potential for Dogecoin price to rise?

Despite the negative on-chain metrics, the DOGE price today is $0.1081, representing a 2.6% increase in the last 24 hours. Dogecoin price analysis shows this may not be the case for long. DOGE price action is neutral to bearish. The chart indicates a potential reversal following a fake out above the neckline of a double bottom pattern. The price attempted to break out but quickly fell back below the 0.1150 resistance level. The price is currently trading slightly above the 50-day exponential moving average (EMA) but the fake-out signals a bearish sentiment.

3. What should investors watch for in the Dogecoin price action?

Investors should watch for a strong base forming at $0.0950, which could present a long-term buy opportunity. However, if the asset surges and breaks above the neckline, it would show market strength, retest $0.13 or higher, and invalidate the bearish thesis.

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