Here’s why DOGE could drop in the coming days.

• Dogecoin price is testing resistance around the 100-day EMA at $0.1073 with a downside imminent.
• On-chain data shows that DOGE daily active addresses are decreasing and dormant wallets are moving again, signaling a bearish move.
• A weekly close of the candlestick above $0.1073 would invalidate the bearish thesis.

Dogecoin (DOGE) price rose slightly during Asian trading hours on Friday, approaching the critical resistance zone around $0.1073. On-chain data shows that DOGE daily active addresses are decreasing and dormant wallets are moving again, signaling a bearish outlook for Dogecoin in the coming days.

Dogecoin price is poised for rejection after retesting key resistance level

Dogecoin price is finding resistance around the 100-day exponential moving average (EMA), which is around $0.1073. This level also aligns with the weekly resistance level of $0.1018. Since Friday, it is trading slightly higher by 1% at $0.1010.

If the 100-day EMA at $0.1073 holds as resistance, DOGE could drop 24% to retest the next weekly support at $0.0782.

The Relative Strength Index (RSI) and the Awesome Oscillator (AO) on the weekly chart are trading below their neutral levels of 50 and zero, respectively, suggesting an impending bearish trend.

DOGE/USDT weekly chart

Santiment’s Daily Active Addresses Index, which helps track network activity over time, aligns with the bearish outlook seen from a technical perspective. An increase in the metric signals greater use of the blockchain, while a decrease in addresses indicates lower demand for the network.

In Doge’s case, daily active addresses fell by 10% this week and have been falling steadily since mid-March, indicating a decrease in demand for DOGE’s use of the blockchain.

Table of DOGE daily active addresses

Additionally, Santiment’s Consumed Age Index shows that spikes in this metric suggest that dormant tokens (tokens stored in wallets for a long time) are on the move and can be used to identify short-term local peaks or troughs .

For DOGE, history shows that peaks have been followed by a decline in Dogecoin price. The most recent rally on August 6 also forecast that DOGE was poised for a downtrend.

DOGE Worn Age Chart

Even though on-chain values ​​and technical analysis indicate a bearish outlook, if Dogecoin price produces a weekly candlestick close above $0.1073, the move would invalidate the bearish thesis. This development could lead DOGE prices to revise its weekly resistance at $0.1435.