- Historical data suggests that this sentiment could come before the price rally to $0.27.
- A significant drop in social volume could signal a potential buying opportunity
Weighted Sentiment for Dogecoin for the First Time Since September 2023 [DOGE] On the charts, it hit -1.562. This is according to AMBCrypto's analysis of Santiment data.
Here, weighted sentiment can be defined as the result of the average comments about an asset on social media.
Hatred can be fuel
On May 24, Kabosu, the Shiba Inu dog that inspired the creation of Dogecoin, passed away. This incident led to a surge in positive comments about Dogecoin. However, a recent survey also revealed that for every positive comment about the coin, there were 1.56 more negative comments.
Typically, when negative sentiment dominates the market, demand for meme coins can drop off the charts, but when it comes to Dogecoin, history shows otherwise.
For example, let’s take September 2023. When the indicator was in a similar position, DOGE’s price was $0.064.
However, the altcoin's price soared to $0.097 in less than three months, a rise that the meme coin community calls a “hate rally,” which occurs whenever pessimism about a cryptocurrency spurs its price to rise on the charts.
Source: Santiment
While history may not repeat itself, there is a chance this pattern could play out again. If so, DOGE price could rise to a yearly high of $0.27 before the start of the next quarter. At the time of writing, the meme coin was priced at $0.16.
It’s also worth noting here that according to data from IntoTheBlock, 84% of all DOGE holders were profitable at the aforementioned price levels.
If the cryptocurrency's value rises as expected, an additional 1.2 billion coins could be in the running. For 100% of the total supply to be in the running, the meme coin's price would need to reach $0.32.
Source: IntoTheBlock
Does Bitcoin have DOGE keys?
This is the average price for the 755,230 addresses accumulating DOGE, which is not impossible, but the price potential could depend on Bitcoin's movement. [BTC] Too much.
AMBCrypto mentioned the correlation between BTC and DOGE. At the time of writing, the correlation between the two coins was 0.86. Meanwhile, Ethereum [ETH] And for most altcoins, the numbers were much lower.
This therefore means that Dogecoin will be more strongly pegged to Bitcoin than other cryptocurrencies.
Source: IntoTheBlock
Recent on-chain data also reveals that the price of Bitcoin is currently at a good accumulation point. Based on this assumption, it is safe to say that DOGE is in a similar state. Therefore, a significant increase in Bitcoin's value could drive the price of DOGE up as well.
Additionally, AMBCrypto also assessed the social volume of meme coins. At the time of writing, this metric fell from 614 to 120.
Whether this is realistic or not, the market capitalization of DOGE in BTC terms is as follows:
From a price perspective, the drop could reinforce the view that demand may be waning, but at the same time, this could present a buying opportunity as most participants have recently felt uncertainty about the coin's short-term performance.
Source: Santiment
