Dogecoin Price Drops, Time to Spend a Lot

Bittime - Dogecoin (DOGE), the leading meme coin, has seen a tremendous price surge over the past week, outperforming its competitors such as Shiba Inu (SHIB) and Pepe (PEPE). 

During this period, DOGE surged by 23%, while SHIB and PEPE only rose 14% and 4% respectively. However, currently the price of Dogecoin is experiencing a decline, and many investors are wondering if this is the right time to buy more.

Short-term holders of Dogecoin (STH) have extended their holding periods, which could impact the price of this meme coin in the short term. According to data from IntoTheBlock, STH DOGE has increased their holding time by 110% in the last month. 

When short-term holders extend their holdings, it indicates a shift in sentiment from short-term speculation to a long-term investment approach, which can reduce selling pressure and help stabilize prices.

Also read: Dogecoin Whale Buys 140 Million DOGE, 30% Increase Predicted Soon

Short-Term Holder Dynamics

Short-term holders play an important role in Dogecoin price dynamics. They tend to react quickly to market movements, which can cause significant price fluctuations. 

However, when they choose to hold their assets longer, this can reduce selling pressure and create more stable conditions for DOGE prices. As holding time increases, short-term holders can help create sustainable upward momentum.

Additionally, DOGE's positive funding rate, which stood at 0.0011% at the time of writing, supports the bullish outlook for this digital asset. 

A positive funding rate indicates that long positions (buyers) are paying short positions (sellers), reflecting bullish sentiment in the market. This indicates that there is higher demand for long positions, which may help keep the price of Dogecoin stable.

Source Bittime.com

Dogecoin Price Prediction

If short-term DOGE holders continue to maintain their hodling strategy, Dogecoin price could extend its upward trend and possibly touch a four-year high of $0.48. 

However, if short-term holders start selling to take profits, this could cause the price of Dogecoin to fall to as low as $0.299. Therefore, it is important for investors to monitor short-term holder behavior and overall market sentiment.

Also read: Dogecoin Price Prediction 2025: Can DOGE Price Break $1?

Opportunity to Invest

With the price of Dogecoin experiencing a decline, this could be an opportunity for investors to buy more. If you believe in Dogecoin's long-term potential, now may be a good time to add to your position. 

However, as with all investments, it is important to do your research and understand the risks involved. By monitoring market developments and holder behavior, you can make better decisions in your Dogecoin investment.

With all these factors, the price of Dogecoin may experience fluctuations, but the potential for long-term growth remains. If you are ready to take the risk, buying Dogecoin when the price drops could be a smart move.

FAQ

Why is the price of Dogecoin falling now?

The price of Dogecoin fell due to changes in market sentiment and potential selling by short-term holders looking to take profits after the previous price spike.

What affects the price of Dogecoin?

Dogecoin's price is influenced by a variety of factors, including short-term holder behavior, overall market sentiment, and funding levels in futures contracts that reflect demand for long positions.

Is this a good time to buy Dogecoin?

If you believe in Dogecoin's long-term potential, now could be an opportunity to buy more. However, it is important to do your research and understand the risks involved before investing.

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Reference

beincrypto.com, Dogecoin (DOGE) Eyes More Gains as Short-Term Investors Extend Holding Time, accessed January 8, 2025.

Author: AWW