Dogecoin was one of the best-performing assets in the crypto market in the past month, outshining blue-chip cryptocurrencies like Bitcoin. According to data from CoinGecko, the meme coin’s price rose by more than 26%, while BTC increased in value by approximately 19% in May.
However, the latest on-chain data shows that investors have still not become bullish about DOGE despite its positive price performance. The question here is – how will the unwavering bearish sentiment impact the price of Dogecoin?
How Will The Bearish Sentiment Benefit Dogecoin Price?
In a recent post on the X platform, prominent crypto pundit Ali Martinez revealed that market sentiment for Dogecoin is currently bearish. This on-chain revelation is based on the weighted sentiment metric, which tracks the overall positive and negative sentiment towards a cryptocurrency.
The weighted sentiment indicator is built on two sub-metrics; namely sentiment balance and social volume. Sentiment balance, as the name suggests, is an indicator that measures the difference between positive and negative sentiment amongst investors at each given time.
Social volume, on the other hand, tracks the unique number of posts/messages or the total amount of discussion around a particular asset on social media platforms. Essentially, the weighted sentiment metric is a product of both the sentiment balance and social.
Source: Ali_charts/X
According to Martinez, the last time the market sentiment around Dogecoin was this bearish was in early February, preceding a 200% price surge. The value of the meme token climbed from below $0.1 to above $0.2 in a little over a month.
Historically, investors’ fear has been a precursor to major price spikes, as the market tends to move in the crowd’s opposite direction. Hence, if history were to repeat itself, investors could see the price of Dogecoin grow exponentially and possibly cross the $0.3 mark.
Whales Acquire 700 Million DOGE In Three Days
Another on-chain revelation that paints a bullish picture for the Dogecoin price is the recent accumulation by whales. As shared by Martinez in another post on X, DOGE whales have purchased 700 million tokens (equivalent to around $112 million) in the past three days.
Naturally, substantial acquisitions by large holders can be a bullish signal for a token’s price. Moreover, the actions of the Dogecoin whales can be worth watching, especially considering the magnitude of their holdings and their influence on market dynamics.
It is worth noting, though, that the recent buying spree hasn’t had any significant effect on the value of DOGE. As of this writing, the Dogecoin price stands around $0.159, reflecting a 0.5% decline in the past day.
DOGE price on a descent on the daily timeframe | Source: DOGEUSDT chart on TradingView