April is a positive period for digital assets as a whole. This asset class has faced its first major adjustment this month in the past 24 hours.
Bitcoin was pushed down to the March 25 price level, and Ethereum briefly fell below $2,000. Other digital assets such as Cardano, Binance Coin, and Chainlink have also recovered. However, we have to consider the market situation of Dogecoin.
Dogecoin has not undergone major adjustments in the past day. After it rose by 300%, the decline from $0.45 to $0.24 was relatively cautious and slow.
The above chart clearly shows that it is out of touch with other digital assets in the market, which is rare for the current rebound of cryptocurrencies based on market sentiment rather than fundamentals. However, the problem still exists and Dogecoin can maintain Go down?
Then we have to discuss the fundamentals of Dogecoin.
According to data from InTheBlock, when 64k addresses bought 16 billion Dogecoins at a price of $0.305 to $0.310, the addresses that bought Dogecoins at a price of $0.25 to $0.31 are currently out of funds.
These specific addresses currently have insufficient funds and may have a certain degree of resistance to current price behavior.
However, as we mentioned earlier, most of the addresses that purchased Dogecoin before April 12 or purchased Dogecoin for less than $0.065 were profitable (i.e. 3.39 million addresses), which adds to the current The possibility that the hoarding volume exceeds the current price range.
The hash rate of Dogecoin’s network has increased from 179/s on October 19, 2020 to 293/s on April 15, 2021, which means that the stability and security of the network continue to improve.
Consider the last time Dogecoin rebounded in the first week of February. Over time, the growth rate of Dogecoin is close to 1100%. Dogecoin has undergone an appropriate correction phase, and the asset price has fallen to the 0.50 Fibonacci line, which is generally considered a reasonable buying range for any asset.
As of the beginning of April, Dogecoin has consolidated within this range and established a solid support range of 0.0473 to 0.0568 US dollars. Now, any asset that is consistent with market fundamentals will get the maximum return of 2 times from the previous rise and may be integrated before the next rise.
The expected price of Dogecoin is $0.14. However, Dogecoin broke the rules of the market and was 167% above the expected peak. This is what certain assets showed in 2017 and helped the popularity of Dogecoin soar.
Fundamentals cannot explain the current prices, but the market doesn’t care because money is flowing into their pockets.
So what’s special about April 20th? Since it is believed that Dogecoin may reflect market sentiment better than any other digital asset, Twitter is currently discussing it, and the owners of Dogecoin may gather together to promote this token on April 20.
Dogecoin 4/20 has had a huge appeal in the past day, and the “Moon Smash” statistics illustrate this point.
At present, the social participation rate of Dogecoin is 931%, and the social dominance is over 536%. Considering that Elon Musk has not posted any news about Dogecoin on Twitter in the past week, the market sentiment of Dogecoin has exceeded expectations.
A week ago, a reasonable market study pointed out that the current price situation of Dogecoin is absurd.
However, as explained earlier, the current community control of Dogecoin far exceeds the fundamentals. Although investing in this asset may still be high-risk, the return is achievable for bold traders. of.
Author/ Translator: Jamie Kim
Bio: Jamie Kim is a technology journalist. Raised in Hong Kong and always vocal at heart. She aims to share her expertise with the readers at blockreview.net. Kim is a Bitcoin maximalist who believes with unwavering conviction that Bitcoin is the only cryptocurrency – in fact, currency – worth caring about.