Dogecoin (DOGE) is making a steady resurgence after falling to its November 2022 low. Will negative social sentiment persuade crypto investors to buy the dip?
A closer look at the on-chain data shows that Meme Coin may have bottomed out.
Dogecoin (DOGE) Social Sentiment Hits Local Low
On March 10, Dogecoin fell to $0.065, in a bearish move that sent it towards levels recorded during the November 2022 crypto crash. However, by March 22, it had recovered by 17% to reach $0.077. Social sentiment seems to have declined among Dogecoin network participants in recent weeks. According to blockchain analytics firm Sentiment, mentions of Dogecoin in popular crypto media channels have dropped significantly over the past 30 days.
The chart below shows how the social dominance of Dogecoin decreased from 6.8% on February 19th to 2.6% on March 22nd.
Social dominance expresses the share of Dogecoin mentions as a percentage of total social media discussions involving a select group of over 50 top-ranking crypto projects.
Typically, a decline in social dominance indicates that most network participants and holders are currently pessimistic, which may cause crypto investors to swoop in to buy the dip.
Another important bullish signal for DOGE is the positive divergence between the daily active addresses and the recent price action.
The chart below shows that between February 22nd and March 21st, the price of DOGE declined by about 10%, but the number of daily active addresses increased from 49,997 to 56,300, forming a series of higher highs.
Typically, if a blockchain network starts to attract traction while the price of the underlying coins is in a decline, it signals an imminent recovery. As a result, the positive divergence could provide further gains for DOGE in the coming weeks.
Dogecoin Price at $0.10 Next?
According to the Exchange Market Depth chart by IntoTheBlock, DOGE may soon break above $0.10. The Market Depth chart shows the major buy walls and important sell areas based on the current limit orders placed on the exchanges.
As seen below, Dogecoin may face minimal resistance until it reaches $0.088, where sellers are looking to offload 24 billion DOGE. If this resistance doesn’t hold, DOGE could reach $0.10, where there are sell orders open for another 1.83 billion DOGE.
For the bears to seize the initiative, DOGE price must break below its current support near the $0.070 area. At this point, buyers have placed orders for over 7 billion DOGE. If this support doesn’t hold, DOGE could test $0.060 again.
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