- Dogecoin’s recent 31% rally to $0.22 appears driven by speculation, not strong fundamentals.
- With weak transaction volume and a high NVT ratio, DOGE risks dropping below the key $0.20 support level.
Dogecoin (DOGE) recently surged 31% in a speculative rally that pushed its price to $0.22. While this rise initially sparked optimism among investors, analysts warn that the gains are not backed by strong fundamentals, making the rally unsustainable.
At the core of this concern is Dogecoin’s Network Value to Transactions (NVT) ratio, which is significantly higher than it was during the legitimate bull run of November 2024. A high NVT ratio suggests that Dogecoin’s market value far exceeds its real-world usage. This is often a red flag, signaling that price action is driven by hype rather than actual demand or utility.
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Adding to the skepticism is the lack of supporting transaction volume. During Dogecoin’s November 2024 run, daily transaction volumes peaked at over $10 billion. In contrast, the current rally has only mustered around $1.2 billion in volume—even as the price nearly mirrors past highs. This sharp drop in usage reveals that investor enthusiasm is not translating into activity on the network, a key ingredient for sustainable price growth.
As of now, Dogecoin is clinging to support at $0.22. Should it fail to maintain this level, the price could slip below the psychological barrier of $0.20, potentially landing at $0.19 or even $0.18. This would not only erase much of the recent gains but also confirm a bearish reversal.
The only path to recovery would be a strong bounce from the $0.22 mark, ideally pushing DOGE back above $0.24—a move that might restore investor confidence and invalidate the current downtrend. However, with weak fundamentals and low engagement, that scenario seems unlikely in the near term.
In short, Dogecoin’s latest rally appears to be more bark than bite. Without a resurgence in transaction activity or fundamental support, the meme coin may soon tumble back below the $0.20 mark.