Dogecoin (DOGE), the cryptocurrency born as a joke, has seen its fair share of ups and downs. With the digital asset currently trading at $0.128, many investors are wondering if now is the right time to buy. A deeper dive into on-chain metrics provides some intriguing insights.
One key indicator is exchange flow. Despite DOGE’s recent price dip, net exchange outflows have been positive, suggesting that investors are buying the dip. This counterintuitive behavior often precedes a price reversal, as accumulated buying pressure can push prices higher.
However, the sentiment surrounding DOGE remains subdued. The Santiment Weighted Sentiment indicator, which combines social volume with investor sentiment, has been hovering below zero for the past three months. This indicates a prevailing negative sentiment among traders. Interestingly, active daily addresses on the DOGE network have mirrored this trend, declining steadily over the same period.
While sentiment and active addresses may seem bearish, other on-chain metrics offer a more optimistic outlook. The Market Value to Realized Value (MVRV) 30-day Ratio, which measures the average profit or loss of investors who bought DOGE in the last month, is currently at 1.87%. This suggests that recent buyers are in profit, indicating potential support for the current price level.
Moreover, there’s a historical accumulation zone around the $0.116 price level, where a significant amount of DOGE was purchased. Such levels often act as strong support as investors tend to defend their positions. If DOGE can hold above this level, a rally towards the $0.175 resistance becomes a possibility.
It’s essential to approach any investment decision with caution. While on-chain metrics provide valuable insights, they are not foolproof predictors of future price movements.