Dogecoin was up 1.25% in the past 24 hours following Bitcoin’s 1.77% bounce. At the time of writing, Bitcoin bulls were fighting to take prices back above $89k, which has been a local S/R level since last Thursday.
Source: Glassnode
The Percent of DOGE Addresses in profit fell to 55.53%, the lowest since the first week of February 2024. Generally, a low number of addresses in profit is a good sign for investors looking to buy.
When this metric reaches multi-year lows, it suggests seller exhaustion. It does not guarantee an immediate, sizeable rally, but it is a good sign for buyers looking to build a position.
Should Dogecoin investors start buying now?
Comparing the previous cycle lows to current figures, DOGE investors might want to wait a bit longer. The previous bear market saw a low of 44.88% recorded in October 2023, an appreciable distance from the current levels.
Source: Glassnode
Additionally, the Coin Days Destroyed metric suggested that capitulation from holders was likely not yet in. In June 2023, the CDD saw a massive spike while the price was near bear-market lows.
Each cycle can be different, but this was something value investors will want to keep an eye on.
Buying at current DOGE prices might be risky, as we likely haven’t witnessed the kind of forced selling that marks a long-term market bottom.
Source: Glassnode
The Realized Price metric also warned long-term investors that selling might continue. Recently, Dogecoin fell below its realized price at $0.146 and retested it as resistance.
In December 2021 – January 2022, DOGE tested the realized price as resistance multiple times before falling nearly 70% over the next six months. A similar scenario could play out during this cycle.
Investors should not hurry to buy DOGE if they aim to hold it for multiple years, based on the metrics examined.
Final Thoughts
- The percent addresses in profit were the lowest they have been in almost two years.
- Other onchain metrics showed that sellers might not be exhausted yet, while highlighting the importance of the $0.14 resistance level as the realized price.
