Dogecoin’s Tightrope Act: Will It Leap or Plunge to $0.075?

• On-chain indicators for Dogecoin depict a contrasting picture, with a notable surge in wallet growth despite recent price volatility.
• Coinglass reports a slight uptick in Open Interest, indicating the possibility of an impending breakout past the $0.080 resistance level.

The Dogecoin price has been trading within a narrow range of $0.75-$0.80 leaving investors confused as to in which direction it would be moving finally. On the hourly chart, the volatility around the coin seems to be extremely tight.

The recent chart analysis reveals a convergence of the lower and upper layers of the Bollinger Bands (BB), a phenomenon last observed in October 2023. During that period, reports from AMBCrypto speculated on the potential for Dogecoin (DOGE) to stage a late-month rally, a prediction that materialized as DOGE’s price surged from $0.060 to $0.075 shortly after.

Despite this, the Supertrend indicators currently advise against buying DOGE, signaling a sell due to its closing above the price with a red color indicator. This suggests a potential downward trend for DOGE’s price, although it’s unlikely to dip below $0.075. At press time, Dogecoin is trading 0.74% down at $0.07842 with a market cap of $11.2 billion.

However, the Relative Strength Index (RSI) stands at 50.85, indicating a resurgence in buying momentum. If the RSI were to dip below 50.00, it could signal low demand for DOGE. Yet, with an uptick in demand, the price of DOGE could potentially rise by an additional 12% to reach $0.090.

On-Chain Indicators for Dogecoin

Recent data from on-chain analytics provider Santiment sheds light on the evolving dynamics of Dogecoin (DOGE), a popular meme-based cryptocurrency. Despite a notable decline of -23% in its value since reaching its peak on December 9th, DOGE has witnessed a significant surge in wallet growth, marking a milestone in the network’s decade-long history.

According to Santiment’s analysis, the number of wallets holding >0 DOGE coins has experienced rapid expansion in recent weeks. Over a span of just two weeks, a staggering 413.8K new wallets have been added to the Dogecoin network, representing the fastest growth rate observed to date.

The influx of new wallets is characterized by holdings ranging from 0.001 to 1 DOGE, indicating widespread participation from retail investors and enthusiasts. This surge in wallet growth comes amidst a period of price volatility for Dogecoin, highlighting the resilience of its community and the enduring appeal of meme-based cryptocurrencies.

Based on heatmap data provided by HyblockCapital, there is a potential for substantial liquidations around the $0.083 mark. This suggests that traders holding long positions with high leverage may face significant losses if triggered.

Meanwhile, according to Coinglass, the Open Interest (OI) currently stands at $422.09 million, showing a slight uptick compared to the previous 24 hours. When considering Dogecoin’s price movement alongside the OI, it indicates the possibility of an imminent significant move. There are indications that DOGE could break past the $0.080 resistance level, with a potential target of $0.095 if this scenario unfolds.