Last week, Elon Mask was accused by investors of insider trading and price manipulation in the Dogecoin lawsuit. In a document recently submitted to the Manhattan Federal Court, investors claimed that Musk allegedly paid online influencers, appeared on SNL, and used Twitter posts to trade DOGE through multiple Dogecoin wallets controlled by him or Tesla, thus making profits
Last week, Elon Mask was accused by investors of insider trading and price manipulation in the Dogecoin lawsuit. In a document recently submitted to the Manhattan Federal Court, investors claimed that Musk allegedly paid online influencers, appeared on SNL, and used Twitter posts to trade DOGE through multiple Dogecoin wallets controlled by him or Tesla, thus making profits. This is clearly at their expense.
After the pessimistic developments related to the "Governor General" were exposed, bearish sentiment in the DOGE market intensified. In the next few days, DOGE will indeed try to compensate for the losses suffered by investors. However, it cannot pull out an extended leg upwards. The Binance lawsuit that unfolded over the past day has made the situation at DOE even worse. In just one day, the value of top meme tokens has dropped by more than 8%. As of the time of publication, its price was $0.0666, which is currently one of the many undervalued tokens.
Well, it is not Elon Musk or the Coin security incident that alone instills pessimism. Even before the aforementioned developments, DOGE had gradually depreciated and was on a downward trend within the daily time frame. In fact, the correlation between this asset and Bitcoin and Ethereum is quite high, 0.9 and 0.72 respectively. This means that the broader market downturn has also had a negative impact on Dogecoin.
Other trends in the Dogecoin market
The Dogecoin market is characterized by insufficient momentum at this stage. RSI has been hovering around a neutral level of around 30, significantly lower than its SMA, proving this. As of press time, the seller controlled the Dogecoin market. The difference indicator between buyers and sellers indicates that the number of tokens sold by sellers is higher than the number of tokens purchased by buyers at all time frames, which makes the price of DOGE even worse.
Now, although the prices of major assets have fallen in the past day, it should be noted that their on chain performance has not fundamentally deteriorated. As pointed out in a recent article, new users and existing users of Ethereum have increased by 58% and 17% respectively in the past week. In fact, even Ripple's network is expanding, as the number of new XRP addresses has been on the rise recently.
Okay, network growth is one of the most reliable predictors of price direction deviation. Usually, a steady increase in the number of new and active addresses often translates into an increase, and vice versa.
However, on the Dogecoin, the trend is completely opposite. In the past week, the number of new addresses has decreased by over 46%. On the other hand, the number of active addresses on the network has decreased by 22%. As of the time of submission, they had flashing values of 12.72k and 48.37k, indicating that the network was shrinking in scale, which is different from their peers.
Bottom line
Therefore, in addition to ElonMusk and Binance, other factors such as macro market conditions, on chain trends and investor sentiment are also influencing the performance of Dogecoin. At present, due to the still sluggish market conditions, investors should be cautious of further declines.
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