The recent movement of the first meme cryptocurrency in the market points towards a crucial support level for DOGE where a massive recovery is possible.
A red candle is forming for Dogecoin for the fifth consecutive month. The meme crypto is currently trading at $0.11, showing the continuation of the bearish run that has become a mainstay of the largest joke-themed cryptocurrency.
The red candle implies that the price of Dogecoin is trading lower than the selling price recorded at the commencement of the month. If the trend continues, this would be its fifth month.
DOGE/USD monthly chart. Source: TradingView
The Trend Continues
Since May 2021, Dogecoin has been declining after reaching its all-time high of $0.76 and has failed to keep the momentum going for some time. However, the price of the DOGE experienced a slight recovery and consolidated significantly, as shown by the monthly green candles marked for August and November last year; another downward spiral set in.
As far as May 2021, Dogecoin marked only two green candles out of eleven for the year, compared to the long stretch of green candles recorded during that period. It implies that the red candles have been the dominant feature of Dogecoin for the past couple of months in question.
The monthly timeframe shows Dogecoin moving toward a critical support zone where a positive turnaround is possible. And the Relative Strength Index Indicator (RSI) also confirmed this, but further consolidation is expected before a significant price surge occurs.
At the time of writing, the price of the meme cryptocurrency is at $0.114, which shows it has been marginally down over the past 24 hours.
A Positive Sign To Consider
Top holders of the canine cryptocurrency appear to be all out, scooping up as many tokens as they can at a discount amid the current market realities. There are concerns over the short-term price of cryptocurrencies in general.
It is worth noting that every market cycle in the crypto industry has an accumulation period during which prices fall, and investors grab the chance to purchase at discount rates.
The next phase of the market cycle is the period of market stability. The market has been stable for some time and is preparing to move higher at a price.
The past 24 hours have seen the top 100 DOGE holders increase their cryptocurrency portfolio, with WhaleStats reporting a 987.76% increase in the average token balance among this category of investors. Also, the average value of their portfolio in terms of DOGE concentration has grown by almost 939.53%.
According to IntotheBlock, the profitability of Dogecoin is still at 53%, with more addresses expected to benefit the network due to the reluctance of holders to sell, even in their position.
Moreover, whales have also returned to accumulate the DOGE token at a discount as the coin price continues to fall. Still, the meme cryptocurrency is likely to bounce back from its recent slump.