The crypto industry is now going through another turbulent period, as evidenced by price data in the past week. Dogecoin, the largest meme cryptocurrency, has particularly led the meme sector in price declines, with most meme coins failing to attract inflows. At the same time, the lacklustre price action has been reflected by a dip in enthusiasm from supporters, according to data analytics. Per data from Santiment, Dogecoin sentiment based on positive mentions across the internet has fallen to its lowest point in 2024. However, while the mood is sour, this could be the best time for traders to scoop up DOGE before the price eventually rebounds.
Dogecoin Weighted Sentiment Drops To 2024 Lows
Santiment’s data is based on the weighted sentiment for Dogecoin. Basically, the weighted sentiment tracks various social media mentions of cryptocurrencies and classifies them as either positive or negative. On account of its status as a meme coin, the price of Dogecoin is heavily impacted by the weighted sentiment.
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Dogecoin’s weighted sentiment is a cycle of ups and downs and always has its moments. Sometimes, on-chain data points to sentiment shooting through the roof. Other times like this, the sentiment is on the downside, with interest waning among retail investors. As Santiment noted, Dogecoin’s weighted sentiment has been on the lower end in the past few days and is currently at its lowest point in 2024.
With Dogecoin sentiment hitting new lows, it’s likely the Dogecoin price will continue to slide lower in the short term. However, keeping in mind that the weighted sentiment is bound to reverse to the upside, this presents an opportunity for shrewd investors to buy in before another FOMO kicks in.
“Patient traders who have been waiting for the crowd to give up on these large cap altcoins may finally have their buy opportunity with FOMO at a 2024 low,” Santiment noted.
Interestingly, this smart investment strategy is further solidified by Dogecoin’s MVRV ratio. The MVRV ratio compares Dogecoin’s market capitalization to the realized value of all Dogecoins in circulation, essentially showing whether the asset is currently overvalued or undervalued. Notably, Santiment data shows that the Dogecoin MVRV ratio has declined steadily over the past 30 days and is currently less than negative -12%. This suggests that the crypto is currently undervalued and is at a price far below its potential.
What’s Next For DOGE Price?
Given Dogecoin’s history of extreme price volatility and momentum-driven rallies, a shift back to positive sentiment could send the meme coin surging once again.
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At the time of writing, DOGE is trading at $0.1248. Notably, price action indicates that DOGE is starting to reverse seven days of declines with a 2.10% increase in the past 24 hours. Also, the relative strength index (RSI) indicator shows DOGE recently bouncing off the oversold threshold, suggesting that it could continue on an upward trajectory.
Featured image created with Dall.E, chart from Tradingview.com
