Dogecoin investor activity has increased significantly in recent days after a period of strong declines. The project promoted by Elon Musk is extremely popular among the cryptocurrency market community. The latest data confirm that Dogecoin is the second most popular project in the cryptocurrency media after Bitcoin. The cryptocurrency was originally created as a joke in 2013 by two developers. Musk only became interested in this project when he learned that many Tesla employees owned Dogecoins. The cryptocurrency market has already shown many times that popular projects can meet with an incredible reaction from buyers at favorable times.
The cryptocurrency price has been moving sideways in recent months. However, the number of Dogecoin owners in the Binance blockchain has been growing rapidly in recent times. At roughly a similar point, Dogecoin began its rally in 2021. This makes some investors appear to be in a rush to buy before the cryptocurrency starts to climb back to its all-time highs. According to data provided by CoinMarketCap, nearly 5 million people currently own Dogecoin. The holders of the largest amounts of Binance Coin have recently increased their Doge balances by over $ 47 million, which demonstrates the potential interest in Dogecoin among large investors as well.
Despite the wide interest of investors, the upward movement cannot gain momentum partially due to the attention-grabbing alternative, competitive 'meme coin' Shiba Inu.
It is worth mentioning that speculative projects in the past recorded above-average gains at times when Bitcoin was moving sideways. This is due to the fact that many investors are looking for high rates of return who tend to jump into solid marketing projects that they could profit from while the Bitcoin price is moving in a narrow range.
In January 2022, Musk announced that Tesla would accept Dogecoin payments for some of the company's goods and services. The controversial cryptocurrency can still count on the support of Elon Musk, who, due to his popularity among market participants, may affect the price of Dogecoin. However, a further downward move is possible in the event of an unfavorable situation on the broad market or if the price does not react to the increase in demand. This could be evidence of potentially strong hands selling cryptocurrency at the same time.
Dogecoin launched this week's trading in upbeat mood and is currently testing a major resistance zone around $0.1600 which is marked with upper limit of the descending channel and 78.6% Fibonacci retrenchment of the upward wave launched in January 2021. Should a break higher occur, the next target for bulls is located at $0.2000. On the other hand, if sellers manage to regain control, then another downward impulse towards support at $o.1200 may be launched. Source: xStation5
