Dogecoin price regained the $0.40 level on Wednesday, up 10% from Tuesday's 20-day low of $0.36. The number of wallets holding DOGE increased by 60,000 from December 2nd to December 11th, indicating an influx of new entrants looking to buy. The volume delta technical indicator shows that DOGE's rebound is supported by a significant increase in market liquidity.
Dogecoin price regained $0.40 territory on Wednesday as bulls rallied 10% in the past 24 hours. DOGE’s on-chain data trends show that a number of new entrants have taken advantage of the correction phase in the cryptocurrency market to buy the bullshit.
Cryptocurrency market enters recovery phase, Dogecoin price regains $0.40
After a shaky start to the week, Dogecoin’s price joined other top-ranked crypto assets in a rapid recovery on Wednesday. According to recent market reports, the rally in the crypto market appears to be related to traders reacting positively to the latest consumer inflation report released by US regulators on Wednesday.
While Bitcoin price regained $101,000 and led the rally, Dogecoin also made significant strides to recover a significant portion of the losses recorded in Monday's crypto market crash.
Dogecoin price fluctuation | DogeUSD
The chart above shows how DOGE price rose to $0.41 on Wednesday, surging 10.2%. This impressive recovery effectively reversed nearly half of the 21.8% loss recorded on Tuesday when the price plummeted to a 20-day low of $0.36.
DOGE acquires 60,000 new wallets amid crypto market downturn
Investors' bets that further Fed interest rate cuts are imminent are clearly pushing Dogecoin and other crypto markets into an early rebound following the release of the latest U.S. Consumer Price Index (CPI) data. It's pushing up. However, a closer look at the underlying on-chain trends reveals that strategic traders who took advantage of market declines also played a pivotal role in DOGE's 10% comeback.
To test this outlook, Santiment’s chart below monitors real-time changes in the number of active funding wallets on the Dogecoin blockchain network. This serves as a proxy for measuring new user acquisition rates around important market events.
Comparison of Dogecoin price and total number of holders
The blue shading in the graph above shows that as of December 2, there were only 6.8 million wallets on the Dogecoin network. However, 60,000 new user wallets acquired DOGE in the past week as the crypto market succumbed to downward volatility over the past week. As of this writing on December 11th, the total number of holder addresses is 6.86 million.
When a large number of new wallets are created during a market decline, it often signals an influx of new strategic traders to take advantage of the price drop and enter the fray. The new capital inflow from these 60,000 new DOGE wallets effectively increases short-term demand.
Obviously, this helped set the stage for the 10.2% DOGE price rebound observed as market sentiment turned bullish after the US CPI report released on Wednesday.
Dogecoin Price Prediction: Focus on $0.50 Breakout?
Dogecoin (DOGE) showed resilience by rebounding 10.2% following the recent market selloff, supported by bullish momentum after the US CPI report. The daily chart shows key technical indicators for a potentially extended recovery, but resistance and support levels require close attention.
Dogecoin price prediction
The main resistance to monitor is the $0.46 level marked by the upper Bollinger Bands, which represents an important psychological threshold.
A break above this zone could pave the way to the next target of $0.50. This was the last level tested during the initial wave of bullish sentiment.
Volume delta data supports a scenario where consistent buying pressure could push DOGE to new near-term highs, but traders should be wary of taking profits near $0.50.
On the downside, immediate support lies at $0.38, below the Bollinger Bands.
A break above this level would invalidate the bullish outlook and could expose DOGE to further correction. A break below $0.38 will open a floor that retests $0.36, where stronger support exists.
