Recently, the social media giant Twitter replaced the 15-year-old “Blue Bird” logo with the Dogecoin logo, causing a sensation in the encryption community. The change had an immediate impact on the market, causing Dogecoin to surge 33% and temporarily separate itself from the rest of the cryptocurrency market.
While the move is seen as part of Musk’s ongoing drive to attract attention and profits, traders and investors haven’t ignored the sudden spike in prices.according to moodthe rise is accompanied by various signals that big players are taking huge profits or ditching assets altogether.
The price surge also led to a surge in the discussion rate of Dogecoin, and the market value rose to the 8th place among the top cryptocurrencies. However, as the initial euphoria faded, Dogecoin prices fell 9 percent from their local highs. This correction, along with various indicators, suggest that a local top is forming and taking profits may be a wise decision.
Whale trade (+$100K)
Looking at average transaction returns, Dogecoin’s 30-day MVRV is +11%, still well below the danger zone of +20% or higher. So even after Elon Musk’s bull run, further price gains are still possible.
Santiment’s analysis also categorizes Dogecoin addresses into four distinct categories to understand the buying behavior of investor groups: fish (0-10 DOGE) – blue line, dolphin (10-10k DOGE) – yellow line, Sharks (10k-10 million DOGE) – red line, Whales (10 million DOGE or more) – orange line.
The smallest fish address is strongly buying at the peak, indicating that the price has peaked. The dolphins and sharks didn’t show any signs of getting involved in the game, while the whales appeared to be in a slight build-up phase ahead of the Twitter logo change.
This suggests that a large number of DOGE holders, including those close to Elon Musk, and possibly Elon himself, knew about the DOGE pump in advance. When the price spikes, the red line (whale) shows signs of dumping, indicating profit-taking.
Despite the recent bull run, Dogecoin’s charts show that “lower highs” had been forming in the hours leading up to yesterday’s rally. This makes it difficult to get too excited about a sudden break in the correlation, whereas a “higher high” would be a more certain signal that a bigger bull market is about to begin.
In conclusion, while Dogecoin’s recent bull run may have been influenced by Elon Musk’s tweets, investors and traders should consider different signals. Let’s wait and see if DOGE will experience another bull run or continue the current downtrend.
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according to Kyptos