Dogecoin has experienced a significant drop of 11% in the past week, causing concern among investors. However, there may be some hope on the horizon as on-chain data suggests that DOGE is currently just above a major demand zone.
According to data from IntoTheBlock, Dogecoin is currently trading above a zone of significant on-chain demand. These demand zones are determined by analyzing blockchain data to identify price ranges where a large number of investors have purchased their coins.
The data shows that there is a substantial demand zone for Dogecoin between $0.096 to $0.139, with a large number of addresses acquiring their coins within this range. This indicates that many investors may be holding Dogecoin at a profit, which could act as a support level for the cryptocurrency.
Historically, demand zones below the current price of Dogecoin have served as points of support, as investors tend to buy more when the price retests these levels. However, there is also a risk that investors who are currently at a loss may decide to sell, creating resistance for the price.
It is important to note that the on-chain data is just one factor to consider when evaluating the future price movement of Dogecoin. Market sentiment, external events, and overall market conditions can also impact the price of the cryptocurrency.
Despite the recent price drop, Dogecoin continues to attract attention from investors and traders. It remains to be seen whether the on-chain demand zone will be able to support Dogecoin and prevent further declines in its price.
In conclusion, while the recent price drop may be concerning for Dogecoin investors, the on-chain data provides some support for the cryptocurrency. Investors should monitor the situation closely and consider all factors before making any decisions regarding their Dogecoin holdings.