Crypto: Why is the Number of Dogecoin Addresses Increasing Despite Alarming Forecasts?

Dogecoin continues to surprise. While most cryptos struggle to find their footing in the current bear market, the number of addresses holding Dogecoin is literally exploding and has surpassed the 6 million mark. In this post, we will first explore the remarkable rise of Dogecoin addresses, and then delve into the contradictory technical signals that muddle the short-term outlook for this iconic crypto.

Increasing adoption of Dogecoin despite market turbulence

Despite the storm currently shaking the crypto market, Dogecoin continues to impressively expand its user base. According to recent data from IntoTheBlock, the number of addresses holding Doge has reached 6.56 million, marking a 20% increase in just eight months. This significant rise highlights a sustained investor interest in this crypto, despite a context of stagnant prices. While Dogecoin’s price struggles to find an upward momentum, the continuous accumulation by holders can be interpreted as a sign of confidence in its long-term potential.

However, this enthusiasm is not yet reflected in Dogecoin’s valuation. While the number of addresses increases, the value of the crypto has not followed the same trajectory. Dogecoin’s price remains trapped in a downward trend, reflecting a dissonance between growing adoption and market performance.

Technical signals under pressure

The short-term outlook for the crypto is far from reassuring. According to a technical analysis by CoinCodex, Dogecoin could experience a 14% decline by mid-September, with a price target around $0.087023. This forecast relies on a series of technical indicators pointing to a continuation of the downward trend. Market volatility, measured at 11% over the past month, adds an uncertainty factor that further complicates predictions. The sentiment of fear, captured by the Fear & Greed Index which remains stuck at 25, reinforces the idea that investors are currently inclined to sell rather than buy.

This contrast between growing adoption and unfavorable technical signals leaves observers in an uncomfortable position. While the increase in the number of addresses can be interpreted as long-term confidence, market indicators suggest that ongoing bearish pressure could erode this confidence. Dogecoin’s resilience in the face of these negative trends will be important to determine whether the asset will manage to reverse the trend or continue to face the turmoil of a market caught in doubt.