Dogecoin Network Activity Goes Parabolic – Will DOGE Price Follow?
Popular memecoin Dogecoin (DOGE) has been trading sideways above its 200-day exponential moving average (EMA) since January 7th. DOGE price is down 0.4% in the last week and 14% in the last month and although the technical structure hints at further losses for DOGE, the recent increase in network activity is interesting.
Dogecoin network activity is increasing.
Dogecoin is experiencing a significant increase in network activity. Data from market intelligence firm IntoTheBlock shows that over 890,000 new Dogecoin addresses were created last week.
This increase in new addresses comes with an 86% adoption rate as new users make their first transactions on the blockchain.
Additional data from Santiment shows an increase in daily active addresses (DAA), which increased from 124,240 on January 23 to more than 498,000 on February 2.
This resurgence in network activity can be attributed to the release of the iconic DOOM video game on the Dogecoin blockchain and the upcoming launch of DOGE-1.
DOOM meets Dogecoin! Developer #minidogeart deploys the 1993 DOOM game on the Dogecoin blockchain using Ordinals technology. Now, game data is entirely sourced from the Dogecoin network, demonstrating the potential of blockchain to protect digital assets.
— BlockVoyager (@BlockVoyagerAIO) January 24, 2024
The third reason is the increasing use of Dogechain, a layer 2 blockchain built on top of the Dogecoin network.
Innovation is essential to bring new wins and with them new users – Dogechain #Dogechain #Dogecoin pic.twitter.com/yjSjsNncqz
— DogeChainNews (@DogeChainNews1) February 2, 2024
These factors have helped to generate interest in the Dogecoin network and if this trend continues, the price of DOGE may respond if investors start taking positions in the token.
However, the technical structure suggests that the price is ready for a deeper correction than the current levels.
Related: Price Analysis 2/2: BTC, ETH, BNB, SOL, XRP, ADA, AVAX, DOGE, DOT, LINK
The descending triangle of the DOGE may attract more bears.
Since December 6, 2023, DOGE's price action has been characterized by a series of low highs and relatively flat lows around $0.078, and a downward triangle has appeared on the daily chart.
This bearish technical formation is confirmed after the price reaches a critical close below the support line – it is formed by equal lows. This shows a decrease in value equal to the height of the triangle
Despite this pessimistic outlook, the Relative Strength Index (RSI) is at the neutral zone of 45, indicating traders' current indecision.
This article does not contain investment advice or recommendations. Every investment and business activity involves risk, and readers should do their own research when making a decision.
