As a seasoned researcher with years of experience tracking cryptocurrency markets, I must admit that the current trends in Dogecoin (DOGE) have piqued my interest. Having witnessed the 2021 bull run firsthand, I can’t help but draw parallels between then and now.
Recent developments in whale activity and chart patterns have further fueled this optimism.
After reaching its lowest point in August, Dogecoin’s price experienced a significant increase of 480%, with a particularly strong jump of 220% following Donald Trump’s victory in the U.S. presidential election in November. Following this surge, the price entered a period of consolidation, trading within a narrow range between $0.39 and $0.48. This pattern mirrors the trend seen in 2021, where a rapid increase was followed by a period of stability before another major move.
Dogecoin Follows 2021 Bull Run Patterns
The likeness between the 2021 surge and recent Dogecoin patterns is notably seen in their weekly Relative Strength Index (RSI). On November 13, DOGE’s RSI surpassed 90, indicating an overbought state. Typically, such overbought situations don’t necessarily foretell a decline. However, in 2021, a comparable RSI signal signaled a strong bullish expansion instead of a correction.
Predictions indicate a possible Dogecoin price of $0.75 by January 2025, marking an approximately 85% rise from the current value. This estimation is derived from Fibonacci retracement analysis, which has shown success in mapping DOGE’s price fluctuations during past market surges.
Large DOGE holders, often referred to as “whales,” are showing increasing optimism based on on-chain data. As reported by Messari, there are now a record 130.2 billion DOGE held by addresses with at least 1 million DOGE, mirroring the buildup seen during the 2021 rally where whale holdings increased from 110.3 billion to 112.5 billion. This accumulation of large positions indicates that influential investors believe in the potential for price increases in the future.
Whale Purchases and Market Sentiment
boosting optimistic feelings, a recent post on X by renowned crypto analyst Ali Martinez showed that substantial Dogecoin investors (whales) bought approximately $160 million of DOGE within a day. This significant increase in purchasing activity suggests growing enthusiasm from affluent investors.
Santiment’s behavioral analysis aligns well with this perspective. The data from their platform reveals a decrease in the average dollar amount invested by age, suggesting that once inactive large wallets have started being active again. This trend seems to imply that long-term holders of DOGE are returning their tokens to circulation, an action usually associated with shifting market sentiments.
The reactivation of older wallets could point to renewed confidence in the token’s future performance. Analysts believe this change in investor behaviour aligns with Dogecoin’s historical pattern, where a similar shift preceded its explosive 2021 price rally.
Over the past day, Dogecoin’s value has increased by approximately 8.51%. This information is based on Brave New Coin’s DOGE Price Index. Some experts claim that this current phase of consolidation resembles the price movements observed in 2021, which preceded a significant surge for the cryptocurrency. If history follows a similar pattern, Fibonacci retracement models predict that Dogecoin could potentially reach $0.75443 by January 2025, as suggested by Martinez.
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2024-12-15 16:46