Most Dogecoin traders with current price positions are at a loss
Dogecoin has paused its meteoric rise as DOGE imitators are making double-digit gains and offering high ROI to tricks on all exchanges. Even at the $ 0.5 level, Dogecoin ranks fourth in terms of market capitalization and the resistance to rising prices is now visible as it has grown in the past two weeks.
This is similar to other memecoin price hikes that face resistance. In the case of DOGE, there is strong resistance around the $ 0.51 level based on forecasts and analysis by several analysts in the network. The In-Out of IntoTheBlock’s money around the current price shows that, of the active portfolios that hold positions around the current price, 87% overall have negative ROI.
DOGE Social Volume || Source: Lunarcrush
Based on the chart above Lunarcrush, social volume peaked after May 9, almost 3 days ago, and now social volume has dropped. This drop in social volume corresponds to a drop in price. There is a direct correlation between the two.
The increase in demand for Dogecoin and the increase in the number of unique addresses at the peak suggests that traders bought DOGE at the top. These traders are those with negative ROI at the current price level, however, they can expect a change in ROI in the coming weeks. Since DOGE is an altcoin with a high concentration of HODLers, the price is largely determined by the selling pressure created by whale portfolios.
The number of trades, close to 100,000 addresses, is currently holding positions between $ 0.48 and $ 0.51, which is a strong level of resistance for DOGE. This could mean a double-digit loss for the HODLers portfolio, however, a return closer to the $ 0.8 level is likely to reduce losses.
Traders are predicting that, unlike XRP, DOGE will recover from the price drop, as there is high social engagement and concentration of large HODLers. This is not the case with XRP. However, it is important to note that the 2017 XRP rally is unparalleled and the recovery is not complete after the altcoin season in 2021. The returns from Dogecoin and other major memecoins are likely to be the biggest variables in the portfolio of most traders in 2021.