Dogecoin has been one of the best-performing assets in the crypto market over the past month, outperforming blue-chip cryptocurrencies like Bitcoin. According to data from CoinGecko, the price of the meme coin increased by more than 26%, while the value of BTC increased by approximately 19% in May.
However, the latest on-chain data shows that investors are still not optimistic about DOGE despite the positive price action. The question here is: how unwavering bearish sentiment impact on the price of Dogecoin?
How will bearish sentiment benefit Dogecoin price?
In a recent article on Platform X, prominent crypto expert Ali Martinez revealed This market sentiment for Dogecoin is currently bearish. This on-chain reveal is based on the weighted sentiment metric, which tracks overall positive and negative sentiment towards a cryptocurrency.
THE balanced feeling the indicator is built on two sub-metrics; namely balance of feelings and social volume. Sentiment balance, as the name suggests, is an indicator that measures the difference between positive and negative investor sentiments at a given time.
Social volume, on the other hand, tracks the unique number of posts/messages or the total number of discussions around a particular asset on social media platforms. Essentially, the weighted sentiment measure is the product of both sentiment and social balance.
Source: Ali_charts/X
According to Martinez, the last time market sentiment around Dogecoin was this bearish was in early February, preceding a 200% price rally. The meme token’s value increased from less than $0.1 to more than $0.2 in just over a month.
Historically, investor fear has been a precursor to large price surges, as the market tends to move in the opposite direction to the crowd. Therefore, if history repeats itself, investors could see the price of Dogecoin grow exponentially and eventually cross the $0.3 mark.
Whales acquire 700 million DOGE in three days
Another on-chain revelation that paints a bullish picture for Dogecoin price is the recent whale accumulation. As sharing by Martinez in another article onand $112 million) over the past three days.
Naturally, substantial acquisitions by large holders can serve as a bullish signal for a token’s price. Additionally, the actions of Dogecoin whales may be worth monitoring, especially given the scale of their holdings and their influence on market dynamics.
It should be noted, however, that the recent buying spree did not have a significant effect on the value of DOGE. At the time of writing these lines, the Dogecoin Price stands at around $0.159, reflecting a 0.5% decline over the past day.
DOGE price on a descent on the daily timeframe | Source: DOGEUSDT chart on TradingView
Featured image from iStock, chart from TradingView
