Dormant Dogecoin Awakens After 19% Drop

Dogecoin (DOGE), the leading Meme Coin, has recently seen increased activity, with long-dormant coins being moved. These coins started changing hands after the coin’s price fell 19% since a three-year high of $0.48 on December 6.

The coin’s move is positive, as it shows that once-dormant Dogecoin is now back in circulation, increasing network activity and possibly pushing DOGE to a recovery.

Dormant Dogecoin is transferred

The on-chain metric in focus here is Dogecoin’s Median Investment USD Age (MDIA), which has been trending down over the past few weeks. This index measures the average age of all coins in the network, weighted by purchase price, which reflects how long they have been held in the wallet.

When MDIA increases, it means coins stay in wallets longer, indicating reduced network activity and often signaling market consolidation. Conversely, a decrease in MDIA indicates an increase in network activity as dormant coins return to circulation, often signaling positive momentum.

According to Santiment, DOGE’s MDIA has dropped to 370 days, indicating that long-held coins have become 31% younger over the past eight weeks as they continue to change owners.

When MDIA has such a downward trend, dormant coins, typically held by large holders or long-term investors, will come back into use, leading to increased network activity, impacting Positive to price.

“This has been one of the key indicators throughout each currency’s history, helping to confirm that a bull market can and should continue. The bull markets of 2017 and 2021 also won’t stop until the average age of assets starts to “grow” (become longer) again,” according to an on-chain data provider that conducted a post on X.

DOGE’s positive funding interest on crypto exchanges confirms this positive outlook. Currently, the funding interest rate of this Meme Coin is 0.003%.

The funding rate is a periodic fee exchanged between traders in a perpetual futures contract that maintains the price in line with the underlying asset. A positive funding interest means that long-term traders (those betting on a price increase) are paying short ones, indicating positive sentiment and potential upward price pressure.

DOGE price prediction: 3-year high may be reached again

On the daily chart, DOGE trades above its Super Trend indicator, providing dynamic support at $0.34. This indicator measures the direction and strength of a price trend. It appears as a line on the chart, changing color according to the current trend: green indicates an uptrend, while red indicates a downtrend.

If this positive trend continues, DOGE could see a recovery towards a three-year high of $0.48.

Conversely, DOGE price could drop to the support the Super Trend indicator points to at $0.34. If the bulls cannot maintain this support, the price could continue to decline to $0.31.

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