Dogecoin (DOGE), the popular meme coin, has defied the recent crypto market slump with a 27% price increase in the last seven days. This surge positions DOGE as one of the top gainers among leading cryptocurrencies. While the price has consolidated recently, on-chain data suggests another potential upswing for DOGE.
Whales Accumulate Billions, Signaling Bullish Sentiment
According to IntoTheBlock, a blockchain analytics platform, the number of addresses holding a massive 10 billion DOGE or more has grown by a significant 50% in the last month. These large investors, often referred to as “whales,” hold considerable sway over the price. Traditionally, a decline in whale holdings indicates selling, potentially leading to a price drop. However, the recent strategic accumulation by these whales suggests a bullish outlook on DOGE‘s short-term prospects.
Strong Support Levels Indicate Potential Price Breakout
If the trend of whales acquiring large amounts of DOGE continues, the price could break free from its consolidation phase and potentially rise. Data from In/Out of the Money Around Price (IOMAP) further strengthens this possibility. This tool identifies addresses based on their purchase price in relation to the current market value.
Addresses “in the money” bought DOGE at a lower price than the current market value. Conversely, addresses “out of the money” purchased DOGE at a higher price. Notably, over 1.11 million addresses holding a combined 13.78 billion DOGE are currently “in the money” between $0.089 and $0.10. This signifies a robust support level around $0.10.
Buying Pressure Mounts, Targeting $0.13 Resistance
Before the recent surge to $0.10, DOGE experienced a price correction of 39%, dropping to $0.082. However, the daily chart reveals a positive Cumulative Volume Delta (CVD), which measures the difference between buying and selling volume. Green bars on the chart represent periods of stronger buying pressure, while red bars indicate selling dominance. Currently, the prevalence of green bars suggests a rise in buying activity.
This trend, if sustained, could see DOGE retest the $0.11 level in the near future. Furthermore, with continued low selling pressure, the price uptrend might persist, potentially reaching the upper resistance level of $0.13.
Also Read: Dogecoin Soars – Whales Accumulate 41% Supply As Bullish Pattern Emerges
It’s important to acknowledge potential risks. If whales start selling their holdings (distribution), it could trigger a price decline, pushing DOGE back below the $0.10 support level.
While the future remains uncertain, the on-chain data paints a promising picture for DOGE. With whale accumulation, strong support levels, and increasing buying pressure, DOGE appears poised for another price surge. However, investors should remain cautious of potential whale distribution that could dampen the rally.
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.
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