Dogecoin (DOGE) Demand Plummets 18% in a Week Amid 1% Price Drop – Analyzing the Decline

• Dogecoin’s (DOGE) demand has seen a significant decline recently.
• This decrease in demand has led to DOGE’s price trading within a narrow range.
• According to on-chain data, the number of daily active addresses and new addresses for DOGE has dropped substantially.

Dogecoin’s demand falls 18% in 7 days as DOGE declines 1% – What’s next for the meme coin?

Dogecoin’s Demand Decline: A Closer Look

In the past week, Dogecoin (DOGE) has experienced a notable decline in demand, as evidenced by on-chain data. This decrease has caused DOGE’s price to oscillate within a tight range, forming a horizontal channel. During this period, DOGE’s price fell by 1%, contrasting with the performance of other leading meme assets. For instance, CoinMarketCap data showed that in the past seven days, the prices of Shiba Inu (SHIB), Pepe (PEPE), DogeWifHat (WIF), and Bonk (BONK) climbed by 9%, 14%, 35%, and 30%, respectively.

Impact on Network Activity

According to IntoTheBlock’s data, the daily count of addresses that completed transactions involving DOGE has cratered by 18% in the past seven days. Similarly, new demand for the meme coin has declined, with the number of new addresses created to trade DOGE falling by 21% during the same period. A decline in an asset’s daily active addresses and new addresses hints at a decrease in the overall trading volume associated with the asset.

Furthermore, Santiment’s data revealed that DOGE’s daily trading volume peaked at $3.01 billion on May 24 and has since fallen by 53%. The decline in trading volume is partly attributable to the negative sentiment that has surrounded DOGE. On May 24, its Weighted Sentiment plummeted to a year-to-date low of -1.56. As of this writing, DOGE’s Weighted Sentiment was -0.35, confirming the negative bias surrounding the leading meme coin.

Market Indicators and Sentiment

When an asset’s price trends within a range, there is a balance between buying and selling pressures, with neither the bulls nor the bears able to trigger a trend in their direction. DOGE’s key momentum indicators confirmed this equilibrium. Its Relative Strength Index (RSI) was 53.52 at press time, while its Money Flow Index (MFI) was 55.72. A combined reading of both indicators suggested that neither bulls (buyers) nor bears (sellers) were in firm control, indicating a balance between buying and selling volume.

Conclusion

The recent decline in Dogecoin’s demand and trading volume, coupled with negative market sentiment, has led to its price trading within a narrow range. While other meme coins have seen price increases, DOGE’s performance has been lackluster. Investors should closely monitor DOGE’s key momentum indicators and market sentiment to gauge future price movements. The current balance between buying and selling pressures suggests that a significant price movement in either direction may require a substantial shift in market sentiment or demand.