Dogecoin recorded a 0.27% decline over the past 24 hours, trading around $0.1219 at the time of writing. On-chain data suggests Dogecoin investors should proceed with caution before accumulating positions. The percentage of DOGE addresses holding unrealized profits has dropped to 55.53%, marking the lowest level since early February 2024. While reduced profitability typically indicates potential buying opportunities, current market conditions warrant closer examination before committing capital. Historical Context Reveals Premature Entry Risk The last major downturn in October 2023 saw profitability metrics fall to 44.88%, well below current readings. This gap suggests the market has not reached genuine capitulation levels. The Coin Days Destroyed indicator adds another layer of concern for prospective buyers. This metric tracks the movement of long-held tokens, revealing when seasoned holders liquidate positions. June 2023 witnessed a dramatic CDD spike coinciding with bear market lows. Current data shows no comparable capitulation event has occurred during this cycle. Each market cycle exhibits unique characteristics. However, the absence of significant forced selling raises questions about whether DOGE has established a durable bottom. Investors seeking long-term positions may benefit from waiting for clearer capitulation signals before deploying funds. Realized Price Breakdown Echoes 2021-2022 Pattern The Realized Price metric presents perhaps the most compelling warning for patient investors. Dogecoin recently fell below its realized price of $0.146 and has since tested this level as resistance. This technical development mirrors a concerning pattern from the previous cycle. Between December 2021 and January 2022, DOGE repeatedly failed to reclaim its realized price as support. Following these unsuccessful attempts, the asset declined nearly 70% over six months. The current price action displays similar characteristics, suggesting history could repeat itself. Technical analysts emphasize that realized price represents the average cost basis across all holders. When an asset trades below this threshold and cannot reclaim it, selling pressure often intensifies as more holders fall into unrealized losses. The recent retest as resistance indicates buyers lack sufficient conviction to push prices higher.
