After a month of upward movement that saw Dogecoin [DOGE] climb by 131.22%, its momentum has slightly eased in the past week. Despite this, the cryptocurrency still managed to record gains of 3.27% over the week and 1.87% in the last 24 hours.
These recent trends point towards a continued bullish sentiment among investors, with many opting for accumulation strategies in anticipation of a potential market breakout.
This behavior lends support to the theory that a significant price shift could be on the horizon for Dogecoin.
DOGE Witnesses a Surge in High-Value Transactions
Over the past 24 hours, Dogecoin has experienced a notable increase in high-value transactions, reaching levels surpassing those seen in recent years.
Information from IntoTheBlock indicates a transaction volume spike to 60.9 billion DOGE, amounting to $23.35 billion, driven by a remarkable 9,410 large transactions within this period.
High-value transactions typically involve market participants holding at least 1% of the total coin supply.
These significant players, often known as whales, wield considerable influence over market trends, capable of initiating either market rallies or downturns.
Connecting with BTC’s Trends
Dogecoin has exhibited a strong correlation with Bitcoin, the leading cryptocurrency with a market capitalization of $1.97 trillion, as per CoinMarketCap’s latest data.
This close correlation, measured at 0.97, highlights Dogecoin’s tendency to mirror Bitcoin’s price movements. With Bitcoin recently hitting a record-breaking high of $104,000 and showing signs of further appreciation in upcoming trading periods, this correlation could positively impact Dogecoin’s price outlook.
Moreover, the duration for which Dogecoin is held post-transaction has surged significantly. Over the past week, the holding period rose by 301.99%, while a 90-day increase of 526.74% extended the average holding timeframe to around four months.
This trend indicates increased confidence in Dogecoin as a long-term investment among larger traders.
The recent influx of buyers, classified as whales by market analysts, indicates a readiness to maintain their positions for roughly four months. Interestingly, the 30-day holding metric presents a different picture, with an average holding duration of two months before any trading activity resumes.
Future Prospects for Dogecoin
Technical analysis suggests that Dogecoin could potentially see a notable surge of 81.08%, potentially reaching $0.84. This projection aligns with Dogecoin’s current consolidation phase on the chart.
Historically, such consolidation phases, marked by horizontal resistance levels and converging diagonal supports following a strong upward rally, indicate a high likelihood of the asset replicating its previous upward momentum.
Should this scenario unfold, Dogecoin may experience a breakout in upcoming trading sessions, largely influenced by market whales.
Once the consolidation phase is breached, a potential rally could materialize, propelling Dogecoin to new price highs.