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The dog-themed cryptocurrency Dogecoin (DOGE) has recently experienced a significant rally. However, this surge is not reflected in prices, but in network activity.
According to crypto analyst Ali Martinez, the number of active Dogecoin addresses has surged to 133,880, an eight-month high.
This increase in active addresses indicates growing interest and engagement within the Dogecoin community. Active addresses are a useful way to monitor network activity over time. Generally, an increase in daily active addresses indicates an increase in blockchain usage, and a decrease indicates a decrease in demand on the network.
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Since the demand for network usage is directly related to the demand for the blockchain’s native cryptocurrency, an increase in daily active addresses tends to lead to an increase in price. However, despite the growth in network activity, Dogecoin’s price has been trading in a range.
Dogecoin thrives on short-term trader activity
In a previous tweet, on-chain analytics firm IntoTheBlock suggested that Dogecoin is thriving on the activity of short-term traders, leaving other meme tokens on the back burner.
Short-term trader activity plays an important role in meme coins, and unsurprisingly, DOGE leads the way with the highest number of short-term traders.
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DEGEN, a meme coin, has 23,000 active short-term traders, which is comparable to that of Shiba Inu, although it accounts for only 10% of the market capitalization. The differences between meme coins are huge, with many mid-cap tokens reportedly having around 4,000 traders.
Dogecoin price fluctuation
After rebounding from the October 10 low of $0.102, Dogecoin has been trading above its 50-day SMA at $0.105 in recent days.
Dogecoin price soared in Friday’s trading session as buyers bought the bullshit. This rally is currently underway, with DOGE price poised to record its third day of gains if today ends in the green.
At the time of writing, Dogecoin was up 0.24% in the past 24 hours to $0.111.
If bulls want to gain the upper hand, DOGE price needs to sustain above $0.11. Dogecoin could then try to rise to $0.13. On the other hand, if Dogecoin price falls below its 50-day SMA, it could indicate that the bulls have given up. If that happens, the price of Dogecoin could fall to $0.08.
