Dogecoin (DOGE), one of the most popular meme tokens, is experiencing the highest social sentiment in the past four months, indicating that a bullish rally may be in store. Renowned cryptocurrency expert Ali Martinez stated that the last time DOGE had similar social sentiment was in October 2022, which was followed by a 160% surge in subsequent days. Martinez’s observations were based on a chart created at crypto tracking platform Santiment.
The chart shows a total weighted sentiment for DOGE close to 7 index points in late October 2022, followed by a sharp increase in price, which topped at $0.147. The current social sentiment has nearly reached the October levels at 6.199 points, according to the chart.
“This pattern of social volume and highly positive sentiment toward Dogecoin perfectly illustrates how euphoria creates price tops. Regardless of your opinion on DOGE, hype on this asset in particular historically foreshadows market conditions,” tweeted Santiment.
At press time, DOGE was trading at $0.09, representing a 2.71% decline on the day. However, the digital asset has gained 5.99% over the previous seven days and 4.11% on its monthly price chart, according to data retrieved on February 17.
The recent correction followed a price increase that occurred after Tesla CEO Elon Musk jokingly teased a photo of his dog as the new CEO of Twitter, two months after the community supported his resignation in a poll he posted.
As the cryptocurrency market consolidates, the recent surge in DOGE social sentiment may result in another bullish rally in the coming days. This sentiment shift is supported by the positive performance of other digital assets in recent weeks. Bitcoin, the leading cryptocurrency, has surged above the $50,000 level, and other altcoins have also experienced significant gains.
According to a recent report by Chainalysis, institutional investors have been accumulating Bitcoin for more than two months, with an average of 18,000 Bitcoin being added to their holdings every week. The report also highlights that Bitcoin’s price has been primarily driven by institutional investors since the second half of 2020.
As the crypto market continues to attract institutional investors, the positive social sentiment around DOGE and other digital assets could lead to a significant price surge in the coming weeks. Traders and investors are advised to stay cautious and closely monitor the market to capitalize on any opportunities.