Dogecoin emerged as one of the top-performing assets in the cryptocurrency market over the past month, surpassing major cryptocurrencies like Bitcoin in terms of gains. CoinGecko data indicates that the price of the meme coin surged by over 26%, while Bitcoin saw a comparatively lower increase of around 19% throughout May.
Nevertheless, despite its notable price performance, recent on-chain data suggests that investors have yet to adopt a bullish stance on DOGE. The lingering bearish sentiment raises the question: how will this persistent pessimism affect the price of Dogecoin?
How Will Dogecoin's Price Benefit From The Bearish Attitude?
Prominent cryptocurrency analyst Ali Martinez disclosed that the current market attitude for Dogecoin is pessimistic in a post on the X platform. The weighted sentiment metric, which measures the general positive and negative attitude about a cryptocurrency, provides the foundation for this on-chain revelation.
The sentiment balance and social volume sub-metrics form the foundation of the weighted sentiment indicator. As the name implies, sentiment balance is a metric that assesses the difference in investor sentiment at any given moment between positive and negative sentiment.
Conversely, social volume measures how many posts or messages are unique or how much conversation there is on a specific item on social media sites. The weighted sentiment metric is essentially a result of both the sentiment balance and social.
Martinez claims that this gloomy market sentiment toward Dogecoin was recently experienced in early February, just before a 200% price increase. In just over a month, the meme token's value surged from less than $0.1 to more than $0.2.
Fear among investors has historically preceded significant price increases because the market usually moves in the opposite direction of the herd. Therefore, if past events are any indication, investors may witness Dogecoin's price rising rapidly and perhaps even surpassing $0.3.
In Three Days, Whales Get 700 Million DOGE
Another on-chain finding that indicates a bullish outlook for Dogecoin's price is whales' recent stockpiling. Martinez revealed in a different X post that DOGE whales had acquired.
Of course, significant purchases made by major holders may indicate that the price of a token is rising. Furthermore, given the size of their holdings and their impact on market dynamics, it can be worthwhile to keep an eye on the behavior of the Dogecoin whales.
However, it is important to note that the recent buying frenzy hasn't significantly impacted DOGE's value. The price of Dogecoin as of this writing is approximately $0.159, down 0.5% from the previous day.
June 2024, Cryptoniteuae