Dogecoin Enters Major Accumulation Zone, Is It Time To Get Back In?

Dogecoin Accumulation Zone Signals Potential Investment Opportunity

The leading meme coin, Dogecoin (DOGE), has entered a significant accumulation zone, indicating a favorable time for investment. This is corroborated by the possibility of a trend reversal from the current downtrend.

MVRV Ratio Suggests Undervaluation and Accumulation

Data from Santiment reveals that Dogecoin's 30-day Market Value to Realized Value (MVRV) ratio is approximately -15%, indicating that many holders are currently at a loss. This negative MVRV ratio typically signals a bottom for meme coins, triggering a period of accumulation due to the token's perceived undervaluation.

Whales and Long-Term Holders Accumulate

In addition to new investors, existing Dogecoin holders are anticipated to seize this opportunity to acquire more coins in an effort to break even on their positions. This is already evident, as IntoTheBlock data shows a notable increase in the token supply held by long-term holders (over a year).

Buying Pressure and Recovery Potential

Crypto investors purchasing Dogecoin during the dip can generate significant buying pressure, potentially sparking a price recovery amidst the market downturn. Furthermore, on-chain data indicates that Dogecoin whales are also accumulating during this period. Notably, 150,000,000 DOGE were transferred from Robinhood to an unknown wallet, while 76,316,694 DOGE were transferred from Robinhood to the same wallet.

These whale movements exert significant market influence, and their purchases could positively impact DOGE's price. Historically, price recoveries have occurred within this MVRV range, suggesting the potential for an imminent recovery.

Technical Analysis and Market Conditions

Crypto analyst Kevin (formerly OG Yomi) highlights Dogecoin's current position in a "major support zone." He believes that the coin should not fall below this level if the crypto market is in a "real bull market." However, Dogecoin faces the risk of dropping below this level, particularly in light of the broader market downturn led by Bitcoin.

Additionally, Fed Chair Jerome Powell's announcement of the rate decision on May 1 could further impact DOGE and other crypto tokens if a hawkish stance is adopted, leading to interest rate increases.

At the time of writing, Dogecoin is trading at approximately $0.123, down over 10% in the last 24 hours, according to CoinMarketCap data.

Source: X

DOGE price falls to $0.123 | Source: DOGEUSDT on Tradingview.com

Featured image courtesy of LinkedIn, chart from Tradingview.com