Dogecoin (DOGE), the iconic crypto inspired by Japan's Shiba Inu dog, could be on the cusp of a new bullish trend. Recent analysis reveals a positive sign often overlooked by investors, suggesting a possible significant increase in the value of DOGE in the days to come.
Crypto – Dogecoin, close to a new uptrend?
The average age of dollars invested (Mean Dollar Invested Age) is an indicator that measures the average age of each dollar invested in a crypto. This index is similar to the Mean Coin Age, which calculates the average age of tokens in circulation. Using on-chain data, the average age of invested dollars converts coins to their USD value at the time of their last movement.
According to Santiment, the top five cryptos – Bitcoin (BTC), XRP, Dogecoin (DOGE), Ethereum (ETH), and Chainlink (LINK) – have all seen a decline in their average age of dollars invested. However, this decline was particularly pronounced for DOGE.
- BTC: 439 days (31% younger in 60 weeks)
- XRP: 865 days (22% younger in 14 weeks)
- Dogecoin (DOGE): 370 days (31% younger in 8 weeks)
This indicates that older, stagnant wallets in the crypto market are putting their coins back into circulation. Which increases network activity and can be interpreted in two ways: either HODLers sell their coins, or new capital enters the market, buying these dormant coins and thus reducing the average age. Dogecoin (DOGE) in particular stands out for the speed and magnitude of this decline, suggesting increased activity and a possible price rally to come. Historically, this trend has been a key indicator of the continuation of the 2017 and 2021 bull markets.
Future outlook
In the short term, analysts predict that dogecoin could reach new highs if current trends continue. The recent increase in addresses holding large amounts of DOGE is a positive sign, indicating that investors are accumulating the crypto in anticipation of a future rise. Additionally, general optimism in the crypto market could also work in Dogecoin's favor. As Ryan Lee, chief analyst at Bitget, also thinks:
Dogecoin could be poised for another surge, thanks to Elon Musk's continued influence keeping DOGE in the spotlight, often triggering price surges. Positive sentiment in the broader cryptocurrency market, particularly among memecoins, provides additional momentum. From a technical perspective, indicators such as the Relative Strength Index (RSI) moving away from overbought conditions and price stabilizing around key moving averages indicate a potential uptrend. If these trends continue, Dogecoin could be on the verge of a new uptrend.
In sum, Santiment's analysis offers an optimistic outlook for dogecoin in the crypto market. However, investors should remain vigilant in the face of volatility and continue to monitor key indicators to make informed decisions.
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