Dogecoin is at a critical juncture on the daily chart, approaching a significant resistance zone. While some large holders, or "whales," are cautiously booking profits, possibly due to uncertainty about whether DOGE can break through this resistance, traders remain optimistic. A breakout above the $0.1 barrier could signal a potential 17% rally. As of the New York trading session, DOGE was trading at around $0.1067, marking a 0.8% increase over the last 24 hours.
Whale Activity and Market Sentiment
Recent data from Santiment indicates that whale transactions began increasing on August 21, peaking on August 22, as DOGE’s price trended upward. This suggests that whales might be cashing in on the rising prices. Further data from IntoTheBlock shows a 194% drop in large-holder netflows over the past week, coinciding with a $179 million increase in Dogecoin exchange reserves. This pattern hints that whales have been cautiously offloading their holdings throughout the week.
Additionally, the total DOGE supply in profit has reached its highest level this month, which could explain why some whales are choosing to lock in their gains at the current price levels.
Spot Traders Drive the Dogecoin Rally
Data from Coinglass highlights that spot traders have played a more significant role than futures traders in driving the recent DOGE uptrend. The funding rate for Dogecoin futures dropped from 0.01% on August 21 to 0.0057% on August 23, even as the price continued to rise. This indicates that while futures traders remain bullish, spot traders are the primary force behind the current upward momentum.
With over 50% of Dogecoin holders currently in profit, there is little incentive for them to sell at a loss, especially if there is potential for the price to recover further.
DOGE Price Analysis: Focus on the $0.1 Level
Dogecoin has recently broken out of a falling wedge pattern, which is often seen as a bullish reversal signal. If the price continues to climb, it could face resistance around $0.1095. A successful break above this level could pave the way for a more substantial upward move, with the next target set at $0.1274.
The Chaikin Money Flow (CMF) indicator shows strong buying pressure, further supporting the bullish outlook. DOGE is currently attempting to break above the 200-day EMA, a key level that would confirm a shift from a bearish to a bullish trend. Sustained trading above the 200-day EMA is generally viewed as a strong bullish indicator.
Should Dogecoin maintain its position above the 200-day EMA with increased trading volume, it could confirm a longer-term bullish trend, potentially driving the price above $0.1274. However, if DOGE fails to break through the 200-day EMA, it could fall back below the falling wedge pattern, possibly revisiting the $0.1000 level or even dropping to $0.095, which would invalidate the bullish scenario.
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