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Crypto analyst Ali explains how dog-themed cryptocurrency Dogecoin might benefit from Shiba Inu's current price move.
Shiba Inu has seen an impressive rise of late, outperforming several altcoins, including Dogecoin. According to Kaiko, Shiba Inu had a boom in developer activity, which contributed to its price increase.
When comparing Shiba Inu's returns to those of Dogecoin since the beginning of July, SHIB is currently outperforming Dogecoin, as indicated by its strong rise at the beginning of August.
Per CoinGecko data, Shiba Inu remains green on all time frames except yearly. In the last 30 days, Shiba Inu has notched gains of 31.2%. Within the same time frame, Dogecoin gains were smaller, coming in at 16.3% on a 30-day basis.
However, if on-chain data and history are any indication, Dogecoin might be on the verge of a significant price move if it follows the SHIB trend. SHIB and DOGE price movements have historically exhibited a strong correlation; whether this will change this time is unknown.
Shiba Inu achieves strong correlation with Dogecoin
Ali, citing data from IntoTheBlock, observes a strong positive correlation between SHIB and DOGE. The 60-day correlation coefficient between the two dog-themed assets currently comes in at 0.74.
1/2 Data from @intotheblock shows a strong positive correlation of 0.74 between $SHIB and $DOGE. This means that when #SHIB's price moves, #DOGE often follows in the same direction. pic.twitter.com/pavkJSv79n
— Ali (@ali_charts) August 10, 2023
The crypto analyst explains the implications of such a strong correlation: "This means that when SHIB's price moves, DOGE often follows in the same direction."
Given this, Ali suggests keeping a careful eye on Dogecoin, which has not yet followed SHIB's recent price movement.
Tomiwabold OlajideIn the past, Shiba Inu historically followed Dogecoin pumps. If Dogecoin succeeds in claiming a hotly contested barrier as support, it might follow Shiba Inu's pump. However, where Dogecoin trends next remains an open question.
Alex Dovbnya
Dan Burgin
U.Today Editorial Team
Vladislav Sopov