Recent price movements have shown Dogecoin experiencing successive declines, reflecting the prevailing bearish sentiment in the broader market. These developments have gradually diminished faith in this popular meme-based digital currency.
However, there are intermittent efforts by Dogecoin to stage a recovery marked by bullish upticks, indicating a potential turnaround on the horizon. Despite kicking off the week with fleeting bullish momentum, signs are emerging that a significant move could be in the offing. Over the past five weeks, Dogecoin has predominantly trended sideways.
Interestingly, despite this stagnant phase, the Money Flow Indicator (MFI) has been suggestive of substantial accumulation occurring within the Dogecoin ecosystem. Notably, the MFI hit a low of just under 20 on August 5 and has since rebounded to 63.87 as of the latest data. This uptick is also mirrored in the Relative Strength Index (RSI).
The RSI has recently breached its midpoint without facing pronounced selling pressure that would push it below this critical level. Consequently, it appears that Dogecoin enthusiasts are gradually gaining traction in the market, evident in the upward momentum depicted on the charts.
Are Dogecoin Whales Stockpiling?
Furthermore, insights from on-chain data suggest that whales are actively accumulating Dogecoin holdings. A closer look at the large holders’ inflows metric on IntoTheBlock indicates a sharp increase in whales’ balances, surging to 493.15 million DOGE within just the last two days.
This surge highlights a significant uptick in large holders bolstering their positions, affirming a robust phase of accumulation. Conversely, there has been a notable decline in large holder outflows from 442.12 million DOGE to 78.17 million during the same timeframe.
These shifts among large holders signal a transition from exerting selling pressure to expanding their holdings. Concurrently, Dogecoin’s net longs heatmap points to a resurgence in the hot zone where long positions are flourishing, particularly around the $0.101 price level.
The $0.101 price level witnessed a substantial rise in long positions, with approximately 4.154 million at this threshold during the latest test. The corresponding number of net shorts within the same range stood at 1.54 million, with the price trajectory showing an upward momentum. In essence, the overall balance between net longs and net shorts underscores a prevailing bullish sentiment at the time of analysis.
Considering these indicators, Dogecoin seems poised for a significant uptrend in the near term, unless an unforeseen event triggers fear, uncertainty, and doubt (FUD) that may undermine the growing optimism in the market.