Despite the downturn in the memecoin market this week, Dogcoin bulls are still vigorously defending the support level of $0.065
- Despite the downturn in the memecoin market this week, Dogcoin bulls are still vigorously defending the support level of $0.065.
- Once the price of Dog Coin drops below the $0.075 range around August 8th, the miners will stop selling.
- Recent transaction statistics indicate that speculators and industry wide unfavorable factors are driving the current price adjustment of the DOE, rather than worsening online activity.
As the Memecoin market continues to plummet this week, Dogcoin bulls are vigorously defending the support level of $0.065. After making profits for several consecutive weeks, on chain data shows that dog coin miners are now paying attention to another price increase.
The dog coin miners currently have a reserve of 4.37 billion dog coins, controlling approximately 3.1% of the total amount of dog coins in circulation. On chain data analysis investigated how their recent accumulation patterns will affect the price of DOGE in the coming weeks.
Dog Coin Miner Returns to Accumulation Mode
The dog currency rose to a three-month high of $0.082 around July 25th. On chain data shows that many dog coin miners profit from these high prices.
However, as memecoin prices fell below the critical support level of $0.07, they began to resume their accumulation mode this week.
The following IntoTheBlock chart shows that once the DOGE price drops below $0.075 around August 8th, miners begin to reduce their recent selling frenzy.
Between August 8th and 17th, they accumulated an additional 80 million tokens worth approximately $5.3 million.
Miner reserve data tracks real-time changes in wallet balances of recognized miners and mining pools. As it increases, miners will accumulate more block rewards, probably to prepare for another price increase.
Currently, miners control over 3% of the total circulation of DOGE. Therefore, it is not surprising that their recent sell-off is closely related to the ongoing price adjustment of DOGE.
Due to the decrease in block rewards flowing into the exchange, the resulting decrease in market supply may drive DOGE up again.
Industry headwinds are driving a sustained pullback
Since August 8th, the global counterfeit currency market has shrunk by 5%, which is shocking. In recent weeks, unfavorable factors across the industry seem to have had a negative impact on the price of DOGE.
The following figure shows that although the price of DOGE decreased by more than 10% between August 6th and August 17th, the trading activity of Dogcoin increased from 92960 transactions per day to 578860 transactions during this period. This means that trading activity has increased sixfold.
The daily transaction volume can provide you with a deeper understanding of the extent to which the current blockchain network is used for economic activities. When trading activity rises during a downward trend in prices, it indicates that external factors may be the cause of the pullback.
Due to the lack of significant deterioration in the trading activity of Dog Coin, once the bearish trend in the industry subsides, it may immediately enter another price increase.
In summary, the accumulation of miners and the growth of trading activity are important indicators on the chain, which may drive the DOGE price in the coming weeks
DOGE price forecast: consolidating above $0.06
Based on the above on chain statistical data, it can be inferred that in the bearish headwind of the entire industry, the price of DOGE may consolidate around $0.06.
The fund in/out (IOMAP) data that displays the distribution of current holder purchase prices around prices also confirms this premise.
The following figure shows that 44000 addresses purchased 1.18 billion DOGE coins at an average price of $0.065. If miners accumulate funds and trading activities remain high, DOGE may gain significant support within this range.
However, if this support level cannot be maintained, bulls may make another significant purchase at $0.059.
In contrast, bullish miners may take the lead in rising again to $0.08. But in this case, purchasing 206950 addresses of 24.45 billion DOGE at an average price of $0.075 may trigger a pullback.
However, if the resistance in the entire industry cools down, the DOGE price may break through this resistance and rise again to $0.080.
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