Catalysts Indicating Potential Continuation of Dogecoin Price Rally

As 2023 begins, several factors suggest that Dogecoin (DOGE) may continue its upward price momentum. Following a substantial 26% increase at the start of the year, DOGE is now poised to surpass the $0.15 resistance level.

Key Takeaways

Dogecoin ETFs: Recent inflows into DOGE ETFs indicate growing institutional interest.
Derivatives Market Activity: A bullish sentiment among traders on major exchanges supports price growth.
Resistance Levels: Technical analysis suggests DOGE is aiming to break past $0.15, potentially targeting $0.24 next.

Dogecoin

Factors Contributing to Dogecoin's Sustained Price Rally

One major factor supporting the possibility of a continued Dogecoin rally is the recent uptick in inflows into Dogecoin ETFs. Data from SoSoValue reveals that funds like Bitwise and Grayscale recorded net inflows on two out of the first three trading days of the year. Specifically, Dogecoin ETFs saw inflows of $2.30 million and $1.60 million on January 2 and January 5, respectively—marking the first consecutive net inflows since December 3 of the previous year.

These daily inflows into DOGE ETFs signify a renewed interest from institutional investors, which bodes well for Dogecoin's price. If this trend continues, it could lead to further bullish momentum for DOGE. Bloomberg analyst Eric Balchunas has noted that a double-exposure Dogecoin ETF has had an impressive start to the year, rising nearly 40%.

Additionally, data from the derivatives market also points to potential price appreciation for Dogecoin. According to CoinGlass, traders on top platforms like Binance and OKX exhibit bullish sentiment, with a long/short ratio on Binance reaching 2.06, which is significantly above 1. The long/short ratio among top traders on Binance stands at an even more favorable 2.5.

CoinGlass further reports that derivatives trading volume has increased by over 2% to $5.60 billion, although open interest has dipped nearly 7% to $1.78 billion, likely due to market volatility affecting long positions.

Is Dogecoin Ready to Break Above $0.15?

Crypto analyst ZiP recently shared insights on the Dogecoin price via an X post, indicating that the cryptocurrency is currently facing resistance at approximately $0.15. If DOGE successfully breaks through this resistance, it could aim for the next target around $0.24, which coincides with a critical Fibonacci level drawn from previous downturns.

Dogecoin
Source: Chart from ZiP on X

ZiP also mentioned a daily pivot point at $0.1288, which serves as the market's short-term equilibrium level. Trader Tarigrade noted that Dogecoin has broken out of a falling wedge pattern, indicating strong upward momentum. However, he cautioned that a brief price retracement might occur before DOGE embarks on its next significant surge.

As of now, the Dogecoin price stands at approximately $0.148, reflecting a decline of over 2% in the last 24 hours, based on data from CoinMarketCap.

Dogecoin
DOGE trading at $0.15 on the 1D chart | Source: DOGEUSDT on Tradingview.com