Dogecoin recently hit a trading ceiling at $0.165, signaling a high point in its recent trading range. While some market pullbacks occurred, a significant number of Dogecoin holders are still in profit. However, transaction volumes have decreased, suggesting a decline in both demand and overall activity.
Dogecoin tried to break through the resistance barrier at $0.165 but couldn’t, which was the highest point it reached in April. Since its peak on May 6, Monday, Dogecoin has seen a 12% decrease in its value.
Dogecoin Analysis: Holders in Profit Amid Market Retreat
A recent analysis report reveals that a substantial number of Dogecoin holders are still experiencing profits despite the recent market downturn. However, this retreat has been significant, wiping out all gains made in the latter part of March. Fortunately, the selling pressure from these holders hasn’t been as severe as initially feared.
Dogecoin’s price has dropped below the $0.2 mark, turning this level into a resistance point since April. Although there has been an increase in social dominance, social volume has remained relatively unchanged. While this doesn’t indicate an upward trend, it suggests that Dogecoin’s presence on social media remains consistent.
Examining on-chain metrics, there has been a notable decline from the peak levels of daily active addresses seen in February. This decline has persisted for the last six weeks, indicating consistently low levels of activity in the Dogecoin network.
Dogecoin Market Dynamics Analysis: Decrease in Demand and Circulation
Decrease in Transaction Engagement: The situation indicated that addresses were less active in transactions, signaling a decrease in demand for Dogecoin. Transaction volume remained relatively stable in the first half of April but experienced a significant drop towards the end of the month. While there has been some recovery in the last ten days, it’s not indicative of a bullish trend for the token.
Increase in Inactive Circulation and Selling Pressure: On April 26, inactive circulation saw a notable increase, suggesting a large number of tokens being transferred, possibly for sale. Since then, this metric has remained subdued, indicating a reduction in selling pressure. However, the total liquidation levels delta showed a negative trend, with short liquidations outweighing long liquidations. As a result, prices might need to rise further to eliminate the indicated liquidations, potentially occurring after removing the nearest liquidity pockets at $0.147 and $0.144.
Short-Term Price Movement Expectations: For this reason, a movement towards the $0.144 liquidity cluster might be observed, followed by a short-term rise to the range of $0.155-$0.16.
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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