Recent data from IntoTheBlock suggests that there has been a significant increase of 41% in large transactions involving Dogecoin (DOGE) over the past 24 hours. Typically, such positive movements in whale transactions indicate a trend of accumulation, potentially leading to a reversal in the price trajectory.
In addition, the analytics firm’s findings show a notable 34% rise in the number of active daily addresses associated with Dogecoin.
These statistics collectively point towards heightened market interest and activity surrounding this meme-based cryptocurrency. Consequently, CryptoCrypto conducted an analysis of the overall market sentiment towards DOGE to assess the likelihood of a bullish turnaround.
Contradictory Indicators for DOGE
As per Santiment’s data, there was an increase in social volume observed during the period from January 13 to January 21. However, this metric declined over the weekend, suggesting a decrease in social media buzz related to the meme coin.
Moreover, the overall sentiment score remained negative, highlighting the cautious stance adopted by investors leading up to the FOMC meeting scheduled for January 31.
While these bearish signals conflicted with the positive insights from IntoTheBlock’s whale transactions, the mixed indicators inferred that Dogecoin might remain within a specific price range until the Federal Reserve’s rate decision unfolds.
Furthermore, the 30-day MVRV indicator showed a dip into negative territory, indicating that Dogecoin was potentially undervalued and primed for a rebound. Additionally, a substantial portion of top traders on Binance were net long on DOGE, reinforcing expectations of an impending price uptick.
For opportunistic buyers, targeting the demand zone above $0.32 (cyan) could present a favorable entry point. Dogecoin has largely fluctuated between the $0.32 and $0.40 levels since late December.
With the CMF (capital inflows) indicator trending below the neutral mark, a retest of the lower end of the range could be on the horizon in the near future.
Another factor to monitor is the speculation surrounding a Dogecoin ETF, with Bitwise being the latest entity to seek approval for such a product.
Several analysts, including Ali Martinez, have predicted that a green signal for the ETF could propel Dogecoin to $15. Nevertheless, the market sentiment remains divided on the likelihood of SEC approval for the ETF.