As on-chain metrics reveal noteworthy whale accumulation, it seems Dogecoin is on the verge of a significant breakout. According to crypto specialist Ali Martinez, whales have bought around 100 million DOGE over the past week, implying increased sentiment about price recovery.
Ordinarily, the accumulation of Dogecoin is indicative of rising whales, suggesting floods of retail investors and active traders join the market. Such behaviors are typical before upward market movements, which underscores the astuteness of these players.
As of now, Dogecoin is being transacted at $0.1770, representing an approximate 35% increase since April’s bear lows. The sentiment towards DOGE has greatly improved, underpinned by its Dominance rank – which gauges the coin’s value in market conversations – jumping from a meager 0.9% to an impressive 2.524% according to Santiment.
That surge in social buzz is arguably the result of heightened attention after news broke about Nasdaq seeking approval to list 21Shares’ Dogecoin ETF.
Bullish sentiment is also supported by other technical analysis tools deemed bearish. CryptoBullet reported that the Livermore Accumulation Cylinder – a chart pattern indicative of strong reversal potential – has recently surfaced. This is a blend of rising and falling expansion suggesting DOGE is bound for a major upside breakout.
As per the calculation, the meme coin has this time around dipped to the lower end of the poloniex channel and incredibly is considering a breakout toward $3, this highlighting a potential increase of nearly 280% from its current level.
In the short term Dogecoin is breaking out of a large bearish falling wedge, which within itself is a classic bullish reversal structure. The height of this wedge is about 63% and calculating that from the breakout point of $0.1595 puts the price target for the next Dogecoin rally at $0.2625.
On the other hand, a word of caution is important. A dip below $0.1300 from last month’s low is a strong range for DOGE, meaning bearish pressure is still in play. This scenario would most likely cause additional sell-offs and invalidate the bullish direction.
As the bearish DeMarker oscillator indicates, technical indicators and sentiment focused the outlook for dogecoin does seems to trend upward and based on indicators also suggest. That said, traders should be more cautious because of the expose downside risks. The next few weeks will be more decisive in validating those signals supposed to hold up toward a sustained rally.
