Dogecoin (DOGE) has again found itself in the crosshairs of market watchers, with a “blood in the streets” moment, according to data from on-chain analytics firm Sentiment. The latest of the firm researchShared by X on January 8, highlights a series of negative MVRV (market value to realized value) ratios across the crypto landscape — including Bitcoin (BTC), Ethereum (ETH), Cardano (ADA)and Dogecoin.
“Average trade returns are a good representation of whether it’s really the right time to ‘buy low’ or ‘sell high,'” Sentiment said, pointing to current on-chain metrics pointing to an environment where many crypto assets Sitting in oversold territory.
“When MVRVs are negative, it means that purchases or additions to your holdings are doing so while others are at a loss. Historically, these ‘blood in the streets’ moments are when professional traders make money,” Samment writes.
The published data sentiment includes the 30-day MVRV ratio for four major assets as of January 8. Bitcoin’s MVRV ratio is -3.73%, Ethereum’s -7.71%, Cardano’s -6.69% and Dogecoin’s -8.89%.
In simple words, MVRV Compares the total market capitalization of a cryptocurrency (its “market value”) to the total cost base of holders (its “real value”). A negative MVRV often indicates that the average holder is currently underwater on their position.
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For Dogecoin, the -8.89% MVRV ratio indicates that—on average—investors who have acquired DOGE over the past 30 days are sitting on significant unrealized losses. This contrasts with BTC’s less pronounced -3.73%, indicating that short-term holders of Dogecoin are, on average, deeper in the red than Bitcoin. Ethereum (-7.71%) and Cardano (-6.69%) also face negative territory, but their holders have been doing slightly better than Dogecoin over the past month.
Since DOGE’s MVRV is the most negative of the four mentioned, a strong recovery bounce is likely if market conditions stabilize. However, it also represents high risk if broader crypto sentiment remains fragile. As Sentiment notes, traders often scan for a negative MVRV as a potential opportunity to “buy low,” but it’s by no means a guarantee of an immediate upside.
Buy or sell Dogecoin now?
Sentiment analysis further emphasizes how macroeconomic forces have fueled the crypto market’s recent sell-off. On Tuesday, January 7, US bond yields rose after unexpectedly strong economic indicators, with the 10-year Treasury rising to 4.67%.
Much of the market’s concern focused on the higher-than-expected ISM Price Paid Index, a metric that reflects inflation, as well as a surprise increase in JOLTS job openings data. With signs of labor market tightness and possible Inflationary pressureInvestors turned to risk-aversion strategies, hitting crypto assets across the board.
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“Crypto markets dip further, showing small to moderate overbought zone for most assets,” reads Sentiment’s published chart. In this vein, Dogecoin’s current decline coincides with the broader market narrative. If yield and inflation concerns dominate the headlines, we can expect more cautious capital flows into risk assets. Conversely, any sign of cooling inflation or a less restrictive Federal Reserve stance could catalyze a rally — one that could be fueled by negative MVRV ratios across the board.
Still, the contrasting signals create a complicated trading environment. On the one hand, sentiment metrics point to beneficial historical conditions for those looking to accumulate, particularly the -8.89% MVRV for DOGE. On the other hand, uncertain macro data—from Treasury yields to inflation prints—could hamper any near-term recovery.
For now, the outlook on sentiment is measured: “Don’t think these opportunity zone signals will lead to an immediate turnaround. But prospects are pointing to at least a short- to mid-term turnaround for crypto soon, assuming economic or geopolitical factors don’t get in the way. “
At press time, DOGE traded at $0.33.
Featured image created with DALL.E, chart from TradingView.com
