Dogecoin (DOGE) has caught the attention of large investors, as whales have accumulated over 200 million DOGE in the past two weeks. This significant buying spree suggests strong confidence in the memecoin’s future potential, despite ongoing market volatility.
DOGE Price Action: Breaking Through Key Levels
At the time of writing, Dogecoin is trading at $0.1929, reflecting a 4.59% increase in the last 24 hours. The recent price movement follows a breakout from a descending wedge channel, which had kept DOGE under bearish pressure. The memecoin successfully bounced off its support level at $0.24243, indicating a potential turning point.
Currently, Dogecoin faces strong resistance at $0.24243, a critical level that could determine its next move. If DOGE manages to break through this resistance, a sustained price rally may follow. However, failure to hold momentum could push the price back into a bearish pattern.
On-Chain Metrics: Low Activity Raises Concerns
Despite the bullish whale activity, on-chain metrics indicate a lack of widespread participation. Dogecoin’s daily active addresses stand at just 31,212, while transaction count remains low at 8,898. These figures suggest that while large investors are accumulating, the general market sentiment remains lukewarm.
For Dogecoin to sustain a long-term price rally, it will need increased adoption and transaction activity. Without broader market engagement, any upward momentum may be short-lived and largely driven by whale movements.
Stock-to-Flow Ratio Suggests Growing Scarcity
Another key metric, Dogecoin’s stock-to-flow ratio, has seen a sharp rise to 191.12. This metric, which measures the scarcity of an asset, indicates that the supply of DOGE in circulation is tightening. Historically, a higher stock-to-flow ratio has correlated with increased price pressure due to reduced availability.
However, while increased scarcity could support higher prices, it alone is not sufficient to drive long-term growth. The sustainability of this trend depends on continued demand and broader market participation.
The surge in whale accumulation and rising stock-to-flow ratio present a compelling case for a potential DOGE rally. However, the low number of active addresses and transactions raises concerns about the sustainability of any upward price movement.
Also Read: Dogecoin Price Plunge: Whale Accumulation Signals 30% Rebound Ahead
For Dogecoin to experience a significant and lasting rally, it needs more than just whale-driven momentum. Increased adoption, higher transaction volume, and stronger market engagement will be key factors in determining whether DOGE can break through resistance levels and sustain its bullish trajectory.
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of CoinBrief.io. Before making any investment decisions, you should always conduct your own research. Coin Brief is not responsible for any financial losses.
