Dogecoin, the meme-based cryptocurrency, has been gaining steady traction in recent weeks. Though largely considered speculative, fresh data indicates that Dogecoin is ready to enter a strong upward trajectory. A combination of long-term trends, robust on-chain activity, and persuasive technical signals all indicate a potential breakout. According to CoinMarketCap data, trading volumes surged by 68% within 24 hours, reflecting a significant spike in market activity and investor interest.
Let us dive into the three chief reasons behind this bullish thesis for DOGE.
1. Cycle Completion Suggests Next Bull Phase
Dogecoin’s history normally has a three-step cycle: prolonged correction, sideways accumulation, and a steep bullish advance. Market pundits believe DOGE has now finished correcting and is entering a new accumulation phase. This follows similar past cycles, especially in 2017 and 2021, where DOGE moved sharply upwards after extended spells of stagnation. If history is any guide, Dogecoin may be building up for a breakout to the $0.30 or even the $1 levels.
2. On-Chain Data Points to Accumulation
New on-chain data reveals improving investor sentiment in Dogecoin. The Mean Dollar Invested Age (MDIA) indicator, which measures the average age of tokens in holders’ possession, is increasing; a clear indication that holders are not selling. Also, the Age Consumed indicator recently peaked, indicating a big batch of long-hoarded coins were transferred. This behavior has long been associated with major price moves, implying the heavy players are positioning for a rally.
3. Technical Breakouts Validate Bullish Momentum
Dogecoin broke out of a falling wedge trend recently, generally regarded as a bullish reversal indicator. This breakout, along with a bullish crossover in the 5-day Relative Strength Index (RSI), aids the argument for upward momentum. Technical charts now reveal decreasing levels of resistance until the mark of $0.30. Further, a 30-day high in Open Interest (OI) — which is an increase- also supports higher market activity and more trader confidence in an upward trend continuing.
While the crypto market remains unpredictable, Dogecoin is showing strong signals of an impending breakout. From historical cycles and investor behavior to confirmed technical patterns, the evidence is stacking up in favor of a bullish run. As always, investors are advised to conduct their research and manage risk appropriately, but current indicators suggest that Dogecoin could soon reclaim the spotlight.
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