Dogecoin Active Addresses Jump 27% After Paxos Deal, but Bearish EMA Crossover Caps Upside
Highlights
- Dogecoin's 24-hour active addresses have increased by 27% in just 24 hours.
- The increase follows Paxos announcing support for Dogecoin.
- Dogecoin faces a bearish EMA crossover amid intense selling caused by a weak market sentiment.
Dogecoin (DOGE) has seen a 27% increase in the number of active addresses after Paxos said that it will support the meme coin. But DOGE has also formed a bearish crossover between the 50-day and the 20-day EMAs that warns the price might continue falling.
Dogecoin Active Addresses Surge as Paxos Announces DOGE Support
Data from Santiment shows that the 24-hour average for Dogecoin’s active addresses rose from 28,641 to 36,585 between May 31 and June 1 after the Paxos deal with the House of Doge was announced.
This jump in active addresses might have come from traders who started to purchase Dogecoin after reports that Paxos will support DOGE came up. This buying also pushed the price to $0.101 on June 1 before it fell to $0.0978 after a few hours.
One of the buyers was a whale on Hyperliquid who opened a $3.91 million long position on Dogecoin on June 1 after the Paxos deal created optimism that the price might rise. CoinGlass data shows that the whale is currently sitting at an unrealized loss of $128,000 after DOGE price dropped.
SoSoValue data also shows that there were no inflows to spot DOGE ETFs on June 1, completing two straight weeks of the ETFs recording zero flows as institutions remained unswayed even after the Paxos deal.
Dogecoin’s EMA Crossover Caps Upside
Dogecoin’s upside after the Paxos deal was capped by two factors: extreme fear in the crypto market and a bearish crossover of the 50-day EMA below the 20-day EMA. The crossover confirmed that the short-term momentum has shifted to favor bulls, and sellers are now in control.
The RSI reading of 33 further confirms intense selling is going on, and bears have a good grip. The RSI line that is still tipping south has been making lower highs and lower lows since May 5, suggesting that selling has outweighed buying for four straight weeks, and that pushed Dogecoin price from $0.118 to $0.098.
The support level for DOGE lies at $0.093, and bears might test it if selling pressure does not ease.
Dogecoin has to clear the obstacle at the 50-day SMA at $0.102 to confirm a rebound. A move past the 200-day EMA level of $0.12, however, will confirm a bullish long-term Dogecoin price forecast.
Long/Short Ratio Shows Aggressive Short Positioning
The long/short ratio for Dogecoin has remained below 1 since May 6, as short-sellers dominate the futures market for four straight weeks. The ratio stood at 0.88 at the time of writing as fewer traders bet that DOGE price will rise.
Dogecoin’s OI has also dropped from $1.71 billion to $1.27 billion between May 14 and June 2, and that suggests there are fewer people willing to open new positions on Dogecoin.
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Frequently Asked Questions (FAQs)
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