10/25/2022 | FX Street
Dogecoin price is ready to gain positive momentum as whales make a comeback
Dogecoin price holds above a well-established support area, reinforced by the 23.6% Fibonacci retracement level.
A section of Dogecoin whales are back to filling their bags in support of a northbound move to $0.0668
Dogecoin price recovery may stall at $0.0683 based on insight from the IOMAP on-chain metric.
Dogecoin price is searching for an escape from the ongoing consolidation between $0.0578 and $0.0610. The largest meme token trades at $0.0599, although it barely moved over the last 24 hours. However, with support still firming between $0.0560 and $0.0578, the path with the least resistance is bound to remain to the upside.
Whales back a potential Dogecoin price rally
The Dogecoin price consolidation is attracting the attention of large-volume investors, also known as whales, in the crypto industry. Looking at on-chain data from Santiment, addresses holding between 10,000 and 100,000 tokens have since late August continued to buy DOGE.
From the chart below, that cohort accounts for 3.53% of the network's total supply, up from 3.45%, as recorded on August 22. A similar growth pattern was exhibited by addresses holding between 100,000 and 1,000,000 tokens, which currently account for 5.69% of DOGE's circulating supply.
Dogecoin Supply Distribution
Dogecoin Supply Distribution
Although the whales' impact seems to have been thwarted by dominant bear market forces, Dogecoin price will continue preparing for a bullish outcome. Retail investors will eventually return as DOGE swings out of the ongoing consolidation.
Dogecoin price is on the cusp of a bullish move
Dogecoin price is grinding closer to a much-awaited breakout that could elevate it to highs at $0.0668. Sellers have since October 10 tried but failed to compromise support given by the demand area between $0.0560 and $0.0578. Reinforcing this buyer congestion zone is the 23.6% Fibonacci retracement level.
If short-term support holds, as highlighted by the 50-day SMA (Simple Moving Average) (in red), Dogecoin price could quickly free itself from stubbornly bearish shackles.
DOGE/USD price chart
DOGE/USD daily chart
Cycling above the 100-day SMA (in blue) will change the DOGE price technical outlook to favor bulls. However, buy orders will be recommended only after the meme coin obliterates the falling trend line resistance.
As the uptrend starts, traders should consider booking profits along the way, with the 78.6% Fibonacci retracement level at $0.0643 and the resistance at $0.0668 flaunted as possible exit positions.
DOGE IOMAP chart resistance at $0.0680
Dogecoin IOMAP chart
The IOMAP on-chain model reveals a huge seller concentration area between $0.0691 and $0.0671. Approximately 88,300 addresses previously purchased 42.22 billion DOGE within the range. Dogecoin price upside momentum could weaken as it climbs the ladder. It is worth mentioning that holders will consider selling to break even, which would beef up the overhead pressure on the meme coin.