According to DOGE's on-chain measures, the leading meme currency has made a full recovery from the market sell-off that occurred last Monday.
The reversal trendline that began in April could impede DOGE's recovery efforts.
After a recent "Death Cross" warning, the 200-day simple moving average (SMA) might act as an important barrier.
If the price of bitcoin rises beyond $0.130, the bearish argument will be proven wrong.
On Monday, Dogecoin (DOGE) rose 0.5% as it tries to recover from the market drop last week. The on-chain measures for DOGE have shown indications of recovery, leading to a 25% rally in the previous week. On the other hand, important technical signs might impede DOGE's path to recovery.
Recovery is signaled by DOGE on-chain measurements
Based on statistics from IntoTheBlock, Dogecoin is now trading at a price close to the $0.106 mark, which marks the point at which 14.5 billion DOGE tokens were invested. When market sentiment goes negative, these dense accumulation zones can serve as crucial support levels.
The 30-day Market Value to Realized Value (MVRV) Ratio for DOGE is now at -3%, with a recent increase from -16%. So, everyone who purchased DOGE in the last 30 days is still losing money, on average, by 3%.
For a more complete picture of the social volume and investor sentiment around an asset, the Santiment Weighted Sentiment indicator is a useful tool. When there is a surge in positive social activity around an asset, the indicator will rise, with 10 being the maximum. When there is negative emotion but great volume, it drops. It hovers near zero if there is a lot of social volume but mixed emotion. It remains close to zero when the volume is little as well.
Weighted Sentiment for Dogecoin rose to 3.56 during the weekend, according to the data below, before slightly falling to 1.30.
Some technical indicators and trends are showing signs of bearishness, even while DOGE's on-chain metrics are showing signs of recovery.
DOGE may remain lower than its declining trendline
Following Sunday's rejection, DOGE is trying to breach the barrier around $0.111 on the 8-hour chart once again.
The RSI for DOGE is 50 and it is above its moving average, suggesting that there is short-term momentum in the positive direction. After overcoming the $0.111 barrier with the support of the RSI momentum, DOGE will encounter another obstacle in the form of a declining trendline that started on April 8. Over the last four months, this trendline has served as crucial resistance, blocking rallies in both May and July. This reluctance may persist for the days or weeks ahead.
Doge, meanwhile, saw a "Death Cross" on Thursday when the 50-day SMA fell below the 200-day SMA. This usually means that a downward trend has been confirmed, since the 50-day SMA is weaker than the 200-day SMA, which is the shorter term trend. So, if DOGE has a rally, the 200-day SMA might be another important mark at which it is rejected.