Dogecoin Active Addresses Skyrocket 47%-But Can It Escape the $0.20 Price Trap?

Dogecoin's Active Addresses Surge 47%, Yet Price Remains Stable

A 47% monthly increase in Dogecoin's active addresses signals heightened user engagement and potential market interest. However, this surge in activity hasn't translated into a price increase, with DOGE remaining relatively stable around $0.1659.

Recent token movement reveals a net negative balance, suggesting cooling investor sentiment following a period of increased selling.

Network activity demonstrates significant growth. The number of active addresses rose from 110,000 to 163,000 over the past month. Despite this 47% increase, Dogecoin's price has remained steady at $0.1659 over the past 24 hours, experiencing only a minor 0.2% increase.

Dogecoin's Increased Activity: A Deeper Dive

The sharp rise in active addresses points to increased engagement within the Dogecoin ecosystem. This could be attributed to various factors, including expanding retail market adoption, speculative interest, and increased trading volume. This surge is particularly noteworthy given Dogecoin's history of short-lived popularity spikes.

Despite the heightened network activity, Dogecoin's price has remained remarkably stable, fluctuating within a narrow range of $0.1656 to $0.1726 over the past 24 hours. This suggests that while participation is growing, significant buying pressure is yet to materialize.

Should this trend continue, Dogecoin may gradually approach resistance at $0.18. A successful bullish breakout could propel the price beyond $0.20. Conversely, a slowdown in network activity might push Dogecoin back towards its support zone around $0.16.

Dogecoin Faces Selling Pressure: Outflows Outpace Inflows

From late October to mid-November, Dogecoin experienced a significant price rally, exceeding $0.50 before its subsequent decline. This rally saw substantial investor inflows, reflecting strong confidence in DOGE at the time.

Source: Coinglass

Since reaching its peak, DOGE has steadily declined to its current value of approximately $0.1659. Net flow data consistently shows outflows exceeding inflows since November. This distribution phase indicates investors are selling assets, either to profit-take or reallocate funds to other investments.