Dogecoin Whale Accumulation Suggests Imminent Price Breakout

• The Dogecoin price has managed to contain the downside losses unlike peers such as Shiba Inu, amid strategic buying and whale activity.
• Recent on-chain data reveals the influence of strategic whale investors on DOGE’s stable price movement.

All eyes of investors are currently on the world’s largest memecoin Dogecoin (DOGE), which is currently stabilizing just below the $0.08 mark, showing a marginal 1.7% decline in the initial week of February 2024. However, optimistic large investors could instigate a favorable breakout by purchasing during this dip.

The memecoin sector has encountered a lukewarm beginning to February 2024, with notable performers such as Shiba Inu experiencing a 4% dip, BONK declining by 9%, and PEPE down by 5% between January 31 and February 7.

In contrast to other major meme coins, Dogecoin has displayed relatively resilient performance, with a decrease of less than 2% during the first week of February.

Recent insights from on-chain data indicate that strategic whale investors may be contributing to DOGE’s stable price movement over the past fortnight. Santiment’s supply by addresses metric, which tracks the trading activity of large holders, shows that wallets containing between 10 million to 1 billion DOGE collectively held 44.75 billion DOGE coins as of January 23. However, as of February 7, this figure has risen to 45.09 billion DOGE.

The buying pressure exerted by these whales in recent weeks partly accounts for DOGE’s consolidation around the $0.08 range while other meme coins like SHIB, BONK, and PEPE experienced declines.

It’s worth noting that previous surges in the DOGE price have often been preceded by substantial buying activity from this particular group of whales, as indicated by the chart.

The Dogecoin (DOGE) Price Action

Following a week of stagnation within the narrow range of $0.082 to $0.078, speculative activity surrounding Dogecoin is now leaning towards anticipating an imminent price surge.

Santiment’s analysis of funding rate trends observes the alterations in fees paid by speculative traders to sustain their positions in the derivatives market. As illustrated in the chart below, the DOGE funding rate has witnessed an upward trajectory this week, climbing from 0.01% on February 3 to 0.08% by February 7.

Positive funding rates indicate that long position holders are offering increased fees to short traders in anticipation of realizing greater profits when prices experience an upward movement.

These significant factors may propel Dogecoin’s price forward, potentially revisiting the $0.01 region in the upcoming days. Nevertheless, bullish momentum might encounter significant resistance around $0.085, as indicated by the upper Bollinger band technical indicator.

However, a definitive breakthrough above this threshold could pave the way for a bullish surge towards $0.10, as anticipated. Conversely, there remains a possibility that bearish sentiment could disrupt this scenario if the DOGE price dips below $0.07 for the first time in 2024.