Dogecoin Struggles Amid Downtrend Despite Potential Buyer Aggression
Downtrend in Dogecoin: An Analysis of Current Trends and Trader Sentiments
Dogecoin has been struggling with a recovery in recent weeks. After a decline two weeks ago, the total supply has further decreased as the price continues to fluctuate. Recently, Dogecoin has recorded a less favourable price trend, leading to a decrease in the number of profitable tokens. Despite the downward trend, the derivative metric indicates increasing buyer aggression.
Decline in Dogecoin Profits
An analysis of the Dogecoin supply shows a decline in profits at the beginning of the year, following a relatively stable trend in December. The profit remained largely constant, with about 103 billion profitable tokens. However, this number dropped to about 79 billion at the beginning of the year, according to Santiment. Despite efforts to recover, the number could not surpass the 100 billion mark. Currently, there is a slight decline, reducing the number of profitable DOGE to about 78 billion. At the current level, this corresponds to a profit percentage of about 59% of the total supply.
DOGE Remains in the Bear Zone
Looking at the daily timeframe chart of Dogecoin shows a series of fluctuations between gains and losses since the significant drop on January 12. Notably, the losses outweigh the gains. At the end of the trading day on January 19, the DOGE value was about $0.078, marking a slight increase of about 0.6%. At the time of this update, a slight gain of about 0.2% could be achieved, with the price range of $0.078 being maintained.
The trend, represented by the short-term moving average (yellow line), indicates a bearish development. The yellow line was above the price, indicating a less favourable trend. In addition, the Relative Strength Index (RSI) has not been able to cross the neutral line and continues to struggle. According to the latest data, the RSI line barely touched the 40, showing the prevailing strong bearish trend.
Dogecoin Buyers Becoming More Aggressive
Although the overall price trends may not be particularly impressive, an interesting development is evident on the derivative side among traders. An examination of the Coinglass financing rate chart showed a constant rate of about 0.01% since about January 4. However, at the time of this update, there was a notable increase in the financing rate to about 0.05%. This increase indicates a heightened level of aggression among buyers. Such an escalation often suggests a bet by traders expecting a potential price increase.
Sources: Santiment, Trading View, Coinglass