Dogecoin (DOGE), with a declining market value of $23.28 billion, is facing intense selling pressure due to fading risk appetite in the cryptocurrency market. The popular meme coin, which has depreciated by approximately 67% throughout the year, witnessed a 5% drop in the last 24 hours, unsettling its investors.
Rising Demand? Key Insights from Spot Market Data
Despite this, on-chain data reveals an intriguing picture for DOGE. Analysts indicate that under the “Bubble Risk Model,” the asset currently poses no bubble risk. Normally, this model generates a downturn signal for overvalued assets; however, the continued downward trend in metrics suggests that an accumulation phase is strengthening in the market.
Santiment data corroborates this trend. Daily active addresses have reached 73,560 in the latest measure, marking one of the highest levels in recent weeks. This indicates that, despite falling prices, investors continue to actively engage in transactions on the network. The fundamental question for Dogecoin remains: Is there a genuine surge in demand laying the groundwork for a rise? Recent data reveals increased interest from small investors, particularly in the spot market.
The Exchange Netflow metric, observed from exchanges, shows buyers maintaining dominance for the past week. Recently, approximately $3 million worth of DOGE have been accumulated in the spot market, raising the weekly net purchase amount to $50 million. This figure, accounting for about 2% of DOGE’s market cap, indicates significant accumulation.
However, a crucial contradiction exists: Trading volume continues to decline. This reflects ongoing weak confidence in the broader market. Nevertheless, the rising spot demand might provide room for DOGE to surpass $0.14 in the short term.
Dogecoin’s Greatest Challenge: The $0.20 Barrier
While there’s potential for a short-term uplift, a formidable selling wall looms for DOGE. Liquidity maps display a concentration of 11.72 billion DOGE at the $0.20 level, amplifying the possibility of a sharp reversal as the price approaches that threshold.
Thus, the $0.20 region on the DOGE chart is perceived as the “final stop” for rallies. If the price moves toward this level, intense selling pressure could emerge, potentially pushing Dogecoin back into a downward trend.
Conclusion
In conclusion, both hope and risk are simultaneously growing in Dogecoin’s landscape. On the one hand, on-chain data and spot market demand suggest investors are capitalizing on downturns as buying opportunities. On the other hand, the decreasing volume and the substantial selling wall at $0.20 indicate that any price rise attempt could be stalled. Dogecoin’s fate in the coming days is contingent upon sustained investor interest.