Active Dogecoin Wallets Hit 9.5 Million: A Step Toward Mainstream Use?

• Dogecoin’s active addresses reached a new all-time high of 9.52 million.
• Despite increased network activity, DOGE’s trading volume has dropped.
• Technical indicators suggest that DOGE may face difficulty rising toward $1 and could decline to $0.42.

Dogecoin (DOGE) has seen a surge in network activity, with active addresses hitting an all-time high. Over the last 30 days, DOGE’s price increased by 107%, prompting speculation about its potential to reach the elusive $1 mark.

While the possibility exists, on-chain metrics suggest that achieving this milestone might take longer than anticipated.

Dogecoin Active Wallets Reach Record High

According to data from Santiment, the number of active addresses on the Dogecoin network was under 1 million on October 31. As of now, this figure has skyrocketed, reaching a record-breaking 9.52 million active addresses.

Active address counts are an important metric for assessing user engagement and blockchain activity. A rise in active addresses indicates a growing number of users interacting with the network, which is often a sign of increasing adoption and interest in the cryptocurrency. Conversely, a drop in active addresses can signal waning interest.

However, despite this metric often serving as a bullish signal, it hasn’t yet translated into immediate gains. Analysts point to declining trading volumes as a key factor tempering optimism.

Dogecoin Volume and Price Action

On December 5, DOGE’s trading volume exceeded $15 billion, signaling heightened trading activity. Coupled with price increases, this typically suggests a strong uptrend, and DOGE’s price did indeed climb to $0.48.

However, trading volume has since dropped to $6.6 billion, indicating a decline in market interest. If this trend persists, Dogecoin may struggle to climb toward the $1 mark. Instead, it could face challenges maintaining its value above $0.45.

Technical Analysis

Looking at technical analysis, the 4-hour chart for DOGE reveals that the price has fallen below the 20-period Exponential Moving Average (EMA). The EMA is a commonly used tool to gauge market trends. When the price is above the EMA, it indicates a bullish trend, while a drop below it typically signals a bearish market.

At its current price of $0.435, DOGE  is below the 20 EMA. This suggests that the meme coin may experience further downward pressure, with the Fibonacci retracement level pointing to a potential drop to around $0.42 or $0.406
On the other hand, if DOGE manages to rise above the EMA, it could signal a reversal of the current trend, allowing the price to break past $0.48 and potentially make a run toward the $1 mark.

Dogecoin’s recent surge in network activity is a strong sign of growing interest, but challenges like falling trading volumes and resistance at $0.48 present itself as hurdles. Should these barriers be breached, DOGE can rally further, inching closer to the highly anticipated $1 milestone.

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