Faced with a hectic week in the cryptocurrency markets, staunch defenders of the Dogecoin (DOGE) ardently protected the support line at $0.065. After raking in profits for several weeks, on-chain data suggests that Dogecoin miners are anticipating another surge in price.
With nearly 4.37 billion coins in their reserves, representing approximately 3.1% of all DOGE in circulationanalyzing the recent accumulation trends of these miners could give us clues as to where the price of Dogecoin will go in the coming weeks.
Back to Accumulation: The Dogecoin Miner Strategy
Dogecoin had an impressive run, reaching a 3-month high of $0.082 around July 25. On-chain data shows that of many Dogecoin miners seized this opportunity to make a profit in the face of these high prices.
However, with the recent correction in the price of coin memes, and in particular Dogecoin falling below the crucial $0.07 thresholdan interesting trend has emerged this week: miners have returned to accumulation mode.
IntoTheBlock’s chart illustrates this trend. It can be observed there that the miners started to reduce their sales once the price of DOGE is dipped below $0.075around August 8.
In addition, during the period extending from August 8 to 17, they accumulated an impressive total of 80 million coinsworth approximately $5.3 million.
Data on miners’ reserves allows real-time monitoring of changes in the balances of miners’ wallets and recognized mining pools. When these reserves increase, it means that miners accumulate more block rewardslikely in anticipation of further price increases.
Currently, miners hold just over 3% of DOGE’s total circulating supply. It is therefore not surprising to find that their recent wave of selling has been closely linked to the correction in the price of DOGE.
With fewer block rewards now feeding into exchanges, the consequent decrease in market supply may well be the catalyst of a new surge in Dogecoin.
Transactional activity: hope despite the downtrend
Since August 8, the global altcoin market has recorded a vertiginous contraction of 5%. It appears that headwinds affecting the entire industry have had a negative impact on DOGE prices in recent weeks.
The graph below shows that between August 6 and 17, the price of DOGE fell by more than 10%. However, during this same period, Dogecoin’s transactional activity jumped from 92,960 daily transactions to 578,860.
This is a transactional increase multiplied by six. The daily number of transactions provides insight into the current use of a blockchain network for economic activities. An increase in transactional activity in times of falling prices suggests that external factors could be the cause of this recession.
Since Dogecoin has not experienced a significant downgrade in transactional activity, it could quickly start a new rise in prices as soon as the downtrend in the industry subsides.
In conclusion, the accumulation carried out by miners coupled with the growth of transactional activity are essential on-chain indicators which could favor a rise in the price of DOGE in the coming weeks.
Stabilization around $0.06: What do the on-chain statistics tell us?
According to the previously mentioned on-chain data, it is likely that the DOGE stabilizes around $0.06 against the general downtrend of the market.
IOMAP (In/Out of Money Around Price) data shows that 44,000 addresses acquired 1.18 billion DOGE at an average price of $0.065. This concentration suggests strong support at this level, especially if miner activity and transactions remain elevated. However, if this level is not maintained, another strong support could form at $0.059.
Future prospects: towards a new rise in DOGE?
If the positive momentum from the miners continues, a further rise towards $0.08 could be on the horizon. Nevertheless, it should be noted that 206,950 addresses have already acquired 24.45 billion DOGE at an average price of $0.075. This level could therefore lead to a decline.
However, if the current market turmoil subsides, nothing would prevent DOGE from breaching this resistance. and aim for $0.080 again.
At the time of closing this article, Dogecoin (DOGE) price stands at $0.063. It is up 1.54% over the past 24 hours, although the week was marked by a regression of about 17%. The next few days will tell us if this dynamic will continue.
Source : beincrypto