Key insights:
Onchain data indicates that short-term holders are accumulating amidst market fluctuations.
Technical indicators are reminiscent of previous Dogecoin bull runs, suggesting a possible breakout to $1.60 by Q1 2026.
Dogecoin (DOGE) saw a significant decline on Oct. 10, with prices falling from $0.25 to $0.08 in a rapid 66% flash crash. Although it quickly rebounded to $0.20, the sudden drop erased over $365 million in long positions, surpassing the previous yearly maximum of $89 million in long liquidations. While leveraged markets faced a substantial reset, spot traders might be leveraging this situation.
Onchain data shows that DOGE’s long-term fundamentals remain strong, even after the liquidation event. Alphractal CEO Joao Wedson stated that DOGE has not yet entered a “euphoria” phase, with short-term holders consistently accumulating. The analyst pointed out that DOGE reached its cycle peak in December 2024 right at the CVDD Alpha metric, used to pinpoint cycle tops and bottoms based on Cumulative Value Days Destroyed.
Though the 2024 peak was somewhat weak concerning onchain interest, Wedson emphasized that the model has reliably identified every DOGE peak since 2016.
Recent Hodl Waves data indicates a growing proportion of DOGE supply held by investors with up to six months of coin age, signaling renewed speculative interest. Historically, this trend has led to price increases as fresh capital flows into the market, raising DOGE’s Realized Cap. Moreover, the MVRV Z-Score persists well below the euphoric levels witnessed in 2021, signifying that the market is still in the early stages of expansion.
Additionally, CryptoQuant reported that retail positioning remains neutral, showing no signs of a speculative frenzy. The current state of retail involvement, neither overheated nor indifferent, generally indicates a phase where accumulation exceeds hype.
This stage often precedes greater retail inflows, implying that DOGE’s current rally may have the potential to extend further before reaching its peak.
Related: Crypto ‘got a passing grade’ on weekend crash: Bitwise’s Matt Hougan
Uncertainty may signal bullish momentum for DOGE
While sentiment around DOGE seems cautious in the aftermath of the flash crash, this uncertainty has historically proven to be one of its most potent bullish indicators.
Crypto trader EtherNasyonal noted that every major DOGE rally in history commenced after maintaining persistence above the 25-day moving average, breaking a long-standing downward trend, and entering a retest phase. The trader asserted that all these conditions are currently met, highlighting that DOGE typically embarks on significant runs under circumstances of skepticism and market weariness.
Similarly, market analyst Trader Tardigrade pointed out that DOGE’s current market structure resembles its bull cycle from 2014 to 2017, suggesting a potential breakout rally targeting $1.60 by early 2026.
Related: Data shows 76% of retail traders are long SOL: Will rebound to $200 hold?
This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.
