Dogecoin (DOGE) has defied the odds, surging 32% in May despite a sluggish first half for the memecoin. This week’s price surge appears fueled by a confluence of bullish factors, including speculation around Tesla accepting DOGE and a resurgent Gamestop rally.
Tesla’s (Alleged) Embrace of DOGE Sparks Rally
Early May saw Dogecoin price rise on rumors of Tesla accepting DOGE for merchandise. While this claim, popularized by crypto personality Crypto Rand, turned out to be two years old, the buzz generated a temporary price bump, pushing DOGE to a 20-day high of $0.17 on May 7th.
However, a broader market correction led to a 15% price drop by May 12th.
Gamestop Mania Reignites Retail Interest
This week’s price breakout for DOGE coincides with the return of the Gamestop saga, igniting renewed retail investor interest in memecoins like Dogecoin. The resurgent “meme stock” frenzy appears to be triggering a parallel wave of bullish activity in the memecoin markets.
Whales Accumulate 820 Million DOGE in May
While retail investors dominate crypto headlines, on-chain data reveals a quieter story – whales accumulating DOGE throughout May. Whale wallets, defined as those holding at least 1 million DOGE (around $150,000), have been steadily increasing their holdings, as shown by Santiment data.
These whales have collectively acquired a staggering 820 million DOGE since May 1st, representing an additional $130 million investment. This accumulation suggests whales are capitalizing on the recent positive sentiment around Dogecoin’s ties to Tesla and Gamestop.
Also Read: Dogecoin (DOGE) or Shiba Inu (SHIB): Which Puppy-Themed Coin is Best Positioned to Fetch Returns?
Whale Activity: A Double-Edged Sword
Large whale purchases during a rally can be a double-edged sword. Firstly, their bullish activity can attract new buyers, further propelling the price upwards. Secondly, the significant buying volume adds liquidity to the market, allowing early investors to exit without triggering a price drop.
Dogecoin Price Forecast: Can It Breach $0.20?
The combined forces of the Gamestop rally and whale investment create a strong bullish narrative for Dogecoin. Overcoming the resistance level around $0.17 could propel the price towards $0.20. Sustained buying pressure from whales could be the key to breaking this barrier.
However, a market reversal remains a possibility. If that occurs, bulls are likely to establish a support wall around $0.13.
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