- Analyst suggests that Dogecoin (DOGE) is currently in its accumulation phase and it’s only a matter of time before it gives a strong breakout.
- A large number of Dogecoin wallets are sitting on unrealized profits, but constitute a small cohort of 20 percent.
The world’s largest cryptocurrency Dogecoin (DOGE) has once again come under investors’ radar amid some key on-chain developments for the cryptocurrency. Some market analysts believe that DOGE is currently undergoing a phase of strong accumulation.
As of press time, Dogecoin (DOGE) is trading 1.05 percent down at a price of $0.063 with a market cap of $8.6 billion. Based on a comprehensive analysis of Dogecoin’s monthly, weekly, and daily charts, the pseudonymous technical analyst, Poseidon, suggests that Dogecoin is currently in an accumulation phase. On-chain metrics from IntoTheBlock reveal that approximately 20.73 percent of DOGE wallet holders are in a profitable position at the present price level.
Poseidon identifies a significant accumulation pattern in DOGE, highlighting the price range between $0.093 and $0.05 as particularly crucial for the meme coin. Within this range, DOGE appears to be undergoing an accumulation phase, which is expected to set the stage for its future trajectory.
The analyst emphasizes that Dogecoin has demonstrated remarkable accumulation, even amid its sideways price movement, distinguishing it from Layer 1 and other tokens in the cryptocurrency ecosystem. On the monthly price chart, Poseidon highlights the $0.048 level as a key reference point for DOGE.
According to Poseidon’s analysis, every DOGE token acquired within the range of $0.025 to $0.010 is considered an attractive investment, with the potential to yield substantial gains of up to 10x in the long term.
Dogecoin (DOGE) Wallets On Unrealized Profits
The on-chain metric known as Global In/Out of the Money (GIOM), tracked by the crypto intelligence platform IntoTheBlock, provides further support for the notion of long-term price appreciation in DOGE, as presented by Poseidon. The analyst’s price target for DOGE stands at $0.18.
GIOM is a metric that estimates the volume or percentage of wallets holding a particular token that are currently holding unrealized profits or losses. If the average acquisition price of these wallets is below the current market price, they are considered to be in a state of unrealized profit. Conversely, if the acquisition cost exceeds the asset’s current price, these wallets are experiencing unrealized losses.
According to data from IntoTheBlock, approximately 20.73 percent of DOGE wallets are presently holding unrealized profits. Wallets in a profitable position may choose to engage in “profit-taking,” potentially increasing selling pressure on DOGE. However, it’s important to note that this group of profitable wallets accounts for only 20.73 percent, while a larger proportion, specifically 73.72 percent of wallets, are currently underwater or experiencing unrealized losses.
Courtesy: IntoTheBlock
As long as the number of wallets facing unrealized losses surpasses those in a profitable state, DOGE is more likely to continue its recovery and resume an upward trajectory. At the time of writing, the price of DOGE stands at $0.063 on Binance.
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