New demand for DOGE reached its peak during the week, with the memecoin’s MVRVA ratio suggesting a buying opportunity.
According to IntoTheBlock, Dogecoin (DOGE), the leading memecoin in the crypto market, experienced a significant surge in new demand. On May 2nd, there were 28,000 new addresses created for trading DOGE. This number represents a 102% increase from the lowest point in DOGE’s new demand for the month, which occurred on April 29th.
DOGE Sees Surge in Demand Amidst Market Volatility
Amidst recent market volatility, Dogecoin (DOGE) has witnessed a notable surge in new demand and network activity. According to data from Santiment, the number of daily active addresses involved in DOGE transactions surged by 27% over the past week. Despite this uptick in network activity, the price of DOGE has not experienced a significant rally.
While increased network activity typically precedes a price surge, DOGE’s sustained demand hasn’t translated into substantial price gains. At the time of writing, DOGE is trading at $0.15, recording only a 2% price appreciation over the week, most of which occurred within the last 24 hours. This minor price increase aligns with the broader market decline observed during this period.
Despite the recent market fluctuations, DOGE’s price hike over the last 24 hours signals a bullish sentiment among investors. Santiment’s weighted sentiment metric for DOGE is now positioned to breach its center line on an upward trend. This metric, which gauges market sentiment towards a cryptocurrency, indicates a shift towards positive sentiment if its value rises above zero.
Source: Santiment
Currently, DOGE’s weighted sentiment sits at -0.348, suggesting a predominantly bearish sentiment. However, an increase in trading activity and further gains in DOGE’s price could elevate this metric in the short term.
DOGE’s MVRV Ratio Indicates Buy Signal Amidst Market Volatility
Dogecoin’s Market Value to Realized Value (MVRV) ratio is currently signaling a buy opportunity, according to recent data. The MVRV ratio, calculated over a 30-day moving average, is currently at a negative value of -12.83% as of press time. This metric compares the current market price of an asset with the average price at which most investors acquired their holdings.
A negative MVRV ratio suggests that the asset is undervalued, indicating that its market value is lower than the average purchase price of all tokens in circulation. In contrast, a ratio above one implies that the asset is overvalued, with its market value significantly higher than the average acquisition price.
Traders commonly interpret a negative MVRV ratio as a signal to “buy the dip,” anticipating a potential price rally. This strategy involves purchasing the asset when its market value is below its average acquisition price, with the expectation of profiting from a subsequent price increase.
Important: Please note that this article is only meant to provide information and should not be taken as legal, tax, investment, financial, or any other type of advice.
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