The last week of February started with a significant surge in selling pressure following Donald Trump’s decision to implement tariffs on Canada and Mexico. Dogecoin, the largest memecoin by market cap, witnessed a significant outflow due to its volatile nature, teasing a breakdown below key support. Will the DOGE correction continue?
Key Highlights:
- Dogecoin’s network activity has seen a sharp 95% decline, with active addresses dropping from 2.66 million in November 2023 to just 130,282 today.
- A flag pattern formation drives the current correction trend in Dogecoin price.
- A downsloping trend in daily Exponential Moving Average hints the DOGE’s path for least resistance is down.
DOGE’S Declining Active Addresses Spark Concerns of Extended Correction
The Dogecoin network is witnessing a staggering decline in activity, with the number of active addresses plummeting by 95% since November 2023. The on-chain data shared by crypto analyst Ali Martinez highlights that active addresses have dropped from a peak of 2.66 million in November to just 130,282 today.
This drastic decline raises concerns about DOGE’s network engagement and user participation. The downward trend in active addresses coincided with price retracement as investors favor utility cased tokens in a struggling market.
If the trend continues, the Dogecoin price could face further selling pressure and prolong its current correction.
On the contrary, a surge in active address metric could signal an early sign of recovery.
Dogecoin Price Signals Major Support Test
In the last three months, the Dogecoin price showed a sustained downtrend with lower high and lower low formation. Interestingly, the downfall resonated strictly within two downsloping trendlines revealing the formation bull-flag pattern.
If the pattern holds true, this downfall should allow buyers to revive the exhausted bullish momentum surge and bolster a major breakdown. Currently, the Memecoin price seeks support at $0.2, a psychological level it tested earlier this month it showed intact demand pressure.
If the buyers defended this support, the coin price could chase a 60% surge to challenge the pattern’s major resistance.
However, a recent death crossover between the 50-and-200-day EMA slope votes for higher possibility of bearish breakdown. A successful flip of bottom support to resistance will drive an extended fall to $0.145.
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