Dogecoin (DOGE) remains entrenched in a bear market, having plummeted nearly 70% from its previous year’s peak. Despite this steep decline, on-chain data reveals a troubling trend: large holders—commonly referred to as "whales"—are actively selling off their holdings. Yet, amid the capitulation, a growing number of crypto analysts remain optimistic, pointing to technical patterns that suggest a potential reversal. The big question for investors: should you buy the dip?
Whale Activity Signals Capitulation
On-chain analytics platforms like Santiment show that Dogecoin whales have been consistently offloading their tokens since early April. This sustained selling pressure has only intensified as the price continues to weaken. Over the past weeks, billions of DOGE tokens have changed hands, primarily from large wallets to exchanges—a classic sign of profit-taking or loss-cutting.
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The Network Profit/Loss (NPL) metric for Dogecoin has dropped to -107.3 million, remaining firmly in negative territory since February. This figure represents the aggregate unrealized profit or loss across all transactions. A deeply negative NPL indicates that most DOGE trades are occurring below the original purchase price, reinforcing the narrative of widespread capitulation.
While this may sound bearish, it’s important to note that extreme selling often precedes market bottoms. Historically, when fear peaks and weak hands exit, the foundation for a new bullish cycle begins to form.
Analysts See Light at the End of the Tunnel
Despite the pessimistic on-chain data, some prominent crypto traders believe Dogecoin is poised for a rebound.
Olivier Maximus, an anonymous but widely followed X (formerly Twitter) trader, recently shared that while DOGE remains in a downtrend, a bullish breakout could emerge if the price establishes a "higher low." This technical development would signal weakening bearish momentum and could pave the way for a surge toward $0.35—a 130% increase from current levels.
Another analyst, Steph is Crypto—known for accurate predictions and boasting over 150,000 followers—has gone even further. He forecasts Dogecoin could reach $1 within the next 2 to 3 months. His reasoning? The weekly chart shows a series of higher highs and higher lows, a classic hallmark of an emerging uptrend.
These contrarian views highlight a crucial market dynamic: even during periods of heavy selling, technical strength can persist beneath the surface.
Technical Analysis: Bullish Patterns Emerge
Despite trading in a steep downtrend, Dogecoin’s daily chart reveals several encouraging technical formations.
Inverse Head and Shoulders Pattern
One of the most notable is the potential formation of an inverse head and shoulders (H&S) pattern—a well-known bullish reversal structure. This pattern typically emerges after a prolonged downtrend and signals that selling pressure is waning.
The left shoulder formed during the March pullback, the head marked the recent low near $0.1425, and the right shoulder appears to be taking shape as selling dries up. The neckline—the key resistance level—sits around $0.2047, corresponding to the March 26 swing high. A confirmed breakout above this level would validate the pattern and likely trigger short covering and renewed buying interest.
Double Bottom Formation
Additionally, Dogecoin has formed a double bottom near $0.1425. This pattern occurs when price tests a support level twice and fails to break lower, indicating strong buying interest at that zone. If confirmed with a close above $0.2047, the measured move target aligns with a rally toward $0.35 or higher.
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Key Levels to Watch
For traders and investors, two levels will be critical in determining DOGE’s next direction:
- Bullish Confirmation: A sustained move above $0.2047 (the H&S neckline) and the 50-day moving average would confirm bullish momentum.
- Bearish Risk: A breakdown below $0.1425 would invalidate both the double bottom and inverse H&S patterns, opening the door to a retest of $0.10—a key psychological support.
Frequently Asked Questions (FAQs)
Q: Can Dogecoin recover even if whales are selling?
A: Yes. While whale selling increases short-term downward pressure, markets often bottom when fear is highest. Historical data shows that major rallies frequently follow periods of intense capitulation.
Q: What technical patterns support a DOGE price rebound?
A: Dogecoin has formed both a double bottom near $0.1425 and an emerging inverse head and shoulders pattern. Both are strong bullish reversal signals if confirmed with a breakout above $0.2047.
Q: Why are whales selling Dogecoin now?
A: Whales may be selling due to prolonged price stagnation, broader market weakness, or portfolio rebalancing. Some may also be locking in gains from earlier purchases when DOGE was near all-time highs.
Q: What price targets are analysts predicting for DOGE?
A: Predictions vary. Olivier Maximus sees $0.35 as a realistic target if momentum shifts, while Steph is Crypto forecasts a more aggressive move to $1 within 2–3 months.
Q: Is now a good time to buy Dogecoin?
A: That depends on risk tolerance and strategy. Conservative investors may wait for confirmation above $0.2047. Aggressive buyers might accumulate near $0.1425, betting on a reversal.
Q: What would invalidate the bullish outlook for DOGE?
A: A close below $0.1425 would cancel the double bottom and undermine confidence in the inverse H&S pattern, potentially leading to further downside toward $0.10.
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Final Thoughts
Dogecoin sits at a pivotal juncture. On one hand, whale selling and negative on-chain metrics reflect ongoing bearish sentiment. On the other, emerging technical patterns and analyst optimism suggest a reversal could be brewing.
For investors, patience and precision are key. Waiting for confirmation—such as a breakout above $0.2047—can reduce risk while still offering exposure to potential upside. Whether DOGE reaches $0.35 or even $1 depends on broader market conditions, sentiment shifts, and ultimately, whether buying pressure can overcome current selling waves.
As always in crypto, volatility is guaranteed—but so are opportunities for those who watch closely.