Dogecoin (DOGE) Active Addresses Soar to Record High, Yet $1 Still Out of Reach

Active addresses on the Dogecoin (DOGE) network have reached a new all-time high following the meme coin’s significant price increase in the last 30 days. This milestone has, once again, sparked speculation that DOGE could hit $1 in the short term.

While the coin has the potential to reach that value this cycle, this on-chain analysis explains why it might not be as quick as expected.

Dogecoin Sees Rising Adoption, Decline Elsewhere

Data from Santiment shows that Dogecoin’s active addresses were less than 1 million on October 31. As of this writing, that has changed, and the metric has hit a new all-time high of 9.52 million.

Active addresses are widely used to estimate the number of users interacting on a network. It offers valuable insights into the network’s overall activity and user engagement, serving as a key indicator of blockchain adoption and interaction with a cryptocurrency.

When the reading increases, it means that many users interact with the crypto. On the other hand, a decrease indicates less traction. However, unlike November, when this metric climbed to a record high, and the signal was bullish, this notable rise might not drive a higher value for DOGE.

One reason for this assertion is Dogecoin’s volume. On December 5, the coin’s volume surpassed $15 billion, indicating that there was a lot of buying and selling.

Typically, when the volume increases alongside the price, it indicates further strength for the uptrend. As a result, DOGE’s price climbed to $0.48. However, as of this writing, the volume has dropped to $6.60 billion, indicating that broader interest in the meme coin has decreased.

Should this remain the case, Dogecoin’s value might find it challenging to rise quickly toward the $1 mark. Instead, it could face a decline below $0.45.

DOGE Price Prediction: Time to Cool Off

From a technical perspective, the 4-hour DOGE/USD chart shows that the coin’s price has dropped below the 20-period Exponential Moving Average (EMA).

The EMA detects a cryptocurrency’s trend by analyzing its price changes. When the price rises but is below the EMA, the trend is bullish. On the flip side, if the price drops below the indicators, the price is bearish, and the downtrend can accelerate.

According to the image below, Dogecoin’s price, at $0.45, is below the 20 EMA (blue). Considering this condition, then the coin’s price could go lower, with the Fibonacci retracement indicator suggesting that it could decline to $0.42.

However, if DOGE rises above the EMA, the trend might change. In that scenario, the price might surpass $0.48 and move closer to $1.