Key Takeaways:
- Onchain data indicates that short-term DOGE holders are actively accumulating despite market fluctuations.
- Current technical indicators resemble previous bullish phases for Dogecoin, suggesting a potential rise to $1.60 by early 2026.
Dogecoin (DOGE) faced a sudden drop on Friday, plummeting to $0.08 from $0.25 in a drastic 66% flash crash. Despite a quick rebound to $0.20, this event resulted in over $365 million in liquidations for long positions, significantly higher than the annual peak of $89 million. As leveraged markets underwent significant adjustments, spot traders appeared to seize the opportunity.
Recent data suggests that DOGE’s long-term fundamentals are still intact following the liquidation event. Joao Wedson, CEO of Alphractal, commented that DOGE hasn’t yet entered a state of “euphoria,” with short-term holders steadily accumulating shares. He observed that DOGE hit its cycle peak in December 2024 at the CVDD Alpha metric, a helpful tool for identifying cryptocurrency cycle peaks and troughs.
Recent Hodl Waves data indicates that a growing portion of DOGE supply is held by investors with less than six months of ownership, signaling adaptive speculative inflows. Historically, such conditions precede price increases, given that new capital enhances DOGE’s Realized Cap. Supporting this viewpoint, the MVRV Z-Score remains well below the exuberance levels last experienced in 2021, implying the market is still in a developing expansion phase.
Data from CryptoQuant suggests that retail investor engagement remains stable, with no indicators of irrational excitement. This balance in retail activity, characterized as neither overheated nor indifferent, usually represents an environment conducive to accumulation.
This phase often precedes broader retail market participation, indicating that DOGE might still have room to rise before hitting a peak.
Uncertainty Could Signal Opportunity for DOGE
While caution surrounds DOGE after the flash crash, this very uncertainty can serve as a favorable sign for future price increases.
Crypto trader EtherNasyonal noted that significant DOGE rallies have historically followed persistent trading above the 25-day moving average, breaking a long-term downtrend, and entering a retest phase. All these conditions are presently met, heightening the likelihood of a major upturn in DOGE.
In a similar sentiment, market analyst Tardigrade Trader acknowledged that DOGE’s current market structure resembles that of its past bull cycles from 2014 to 2017, suggesting a potential price rally targeting $1.60 by early 2026.
This article is not investment advice.
Investment involves risks; always conduct personal research when making financial decisions.
