Dogecoin was one of the leading crypto assets driving social media engagement, noted Santiment.
In a post on X, the analytics platform observed that Dogecoin, alongside Bitcoin [BTC], Ethereum [ETH], and ZCash [ZEC], saw the highest rise in social media engagement.
Dogecoin was trending because it was being mentioned on Reddit for sweepstakes events offering DOGE prizes, as well as skepticism regarding the meme’s status, and on X (formerly Twitter) for market activity and price movements.
Based on the memecoin sector price action, assets such as Dogecoin [DOGE] were not forefront in investors’ minds. Do the onchain metrics indicate sustained bearish pressure, or is there hope for a recovery?
Dogecoin exhibits a network-wide accumulation phase
The increased social media engagement was accompanied by a rise in Mean Coin Age over the past two months. Santiment data showed that DOGE was being accumulated among holder addresses, though the price action remained firmly bearish.
In fact, the Age Consumed Metric, which spikes higher if older, dormant tokens move en masse, has remained quiet since mid-November. This further strengthened the idea that sell pressure was fading.
Moreover, the MVRV reached a six-month low in mid-December and has not improved much since then. It suggested a chunk of investors were facing deep losses.
On average, holders over the past six months were sitting on 36% unrealized loss, the metric showed.
Has Dogecoin begun to consolidate?
Source: DOGE/USDT on TradingView
The 1-day chart showed that DOGE formed a range between $0.122 and $0.133. The longer-term trend was strongly bearish, but the price action of the past ten days was encouraging with this range formation.
A move back above the local high at $0.135 would signal a bullish structure shift.
Investors should be wary even if Dogecoin climbs back above $0.135. The Net Unrealized Profit/Loss metric showed a capitulation phase underway for the memecoin.
If the 2021-2022 downtrend were to repeat, the NUPL has much deeper depths to explore.
Sentiment across the market was fearful.
A Bitcoin [BTC] recovery back to all-time highs and beyond is unlikely. Dogecoin traders should remain bearishly biased despite the onchain accumulation, and use price bounces to sell.
Final Thoughts
- Dogecoin showed accumulation onchain, according to the MVRV and age consumed metrics.
- Even so, traders and investors should sell into strength, as a recovery to ATHs is unlikely in the coming weeks and months.