DOGE might add a 5th red monthly candle, but here’s another reason why it’s bullish: Details

Tomiwabold Olajide

Dogecoin is approaching the crucial support level where a reversal could be possible

For the fifth consecutive month, a red candle appears to be forming for Dogecoin (DOGE), which is currently trading around $0.11 and marks the continuation of the bearish streak for the biggest meme token.

A red candle means that the price is trading below the opening price recorded at the beginning of the month. This happened four months in a row in the case of Dogecoin, and it seems to be on track for a fifth.

TradingView Charts
DOGE/USD monthly chart, image credit: TradingView

Dogecoin has been on a downward trend since May 2021, when it hit all-time highs of $0.76. The price has rallied slightly and consolidated as evidenced by the two monthly green candles marked in August and November 2021 before another round of declines.

As of May 2021, Dogecoin only marked two green candles out of eleven monthly candles, compared to the long streak of greenish candles recorded before that date.

On the monthly time frame, Dogecoin is approaching a crucial support level at which a reversal might be possible. The RSI indicator hints at this, while also hinting at further consolidation ahead of a major price surge. At press time, the price of Dogecoin is at $0.114, down slightly in the last 24 hours.

The accumulation of Dogecoins continues: a positive sign

Top Dogecoin holders appear to be picking up discounted tokens amid the current market volatility regarding near-term price action for cryptocurrencies. It may be worth noting that every market cycle has an accumulation phase, during which prices flatten out and contrarian investors see an opportunity to buy low.

Top 100 Dogecoin Holders, Courtesy: WhalesStats

When this market cycle is over, the next one, the “mark-up phase”, begins. It refers to a phase in which the market has been stable for some time and begins to rise.

Over the past 24 hours, the top 100 Dogecoin holders have increased their wallets, as WhalesStats reports a 987.76% increase in the average DOGE balance of this category of investors. The average DOGE value of their portfolio also increased by 929.33%.

Dogecoin profitability, according to InTheBlock data, remains at 53%. More in-the-money addresses should benefit the network as holders are less inclined to sell to break even their positions.

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