Despite struggling to break through the $0.20 resistance, Dogecoin (CRYPTO: DOGE) has shown impressive resilience lately with a 10.25% weekly rally, outpacing some high-cap rivals.

Despite struggling to break through the $0.20 resistance, Dogecoin (CRYPTO: DOGE) has shown impressive resilience lately with a 10.25% weekly rally, outpacing some high-cap rivals.

However, this rally has also been met with challenges, as evidenced by the cryptocurrency’s NVT ratio reaching a three-month high.

However, this rally has also been met with challenges, as evidenced by the cryptocurrency’s NVT ratio reaching a three-month high.

This suggests that the market cap is still rising faster than on-chain transactions are increasing, which could indicate weak fundamental support for the cryptocurrency at current price levels.

This suggests that the market cap is still rising faster than on-chain transactions are increasing, which could indicate weak fundamental support for the cryptocurrency at current price levels.

At the moment, Dogecoin is valued at a massive $26 billion market cap, placing it among the top 10 crypto assets.

At the moment, Dogecoin is valued at a massive $26 billion market cap, placing it among the top 10 crypto assets.

This valuation is realized despite limited use cases for the cryptocurrency, which is largely attributed to its enormous 150 billion token supply.

Dogecoin Network Activity Remains Low

A glance at relevant on-chain metrics reveals that network activity remains below pre-election levels. During November’s breakout when DOGE soared above $0.40, new addresses used on the cryptocurrency’s blockchain exceeded 100,000.

A glance at relevant on-chain metrics reveals that network activity remains below pre-election levels. During November’s breakout when DOGE soared above $0.40, new addresses used on the cryptocurrency’s blockchain exceeded 100,000.

Today, that number stands at just 12,629, highlighting a significant decrease in retail trader interest in the popular meme coin.

Chart: Glassnode

Dogecoin ETF Prospects Fuel Speculation

The potential approval of a Dogecoin ETF by the Securities and Exchange Commission has emerged as a major factor that could influence the cryptocurrency’s price trends.

According to Polymarket data, there’s a 57% chance that the SEC will approve at least one DOGE ETF this year.

Analysts suggest such approval could propel DOGE prices to $0.4336, the highest level attained on January 18, marking a 145% surge from current levels.

The case for approval appears promising considering that Dogecoin operates on a proof-of-work network like Bitcoin (CRYPTO: BTC) and is not classified as a security.

However, market observers identify a critical risk: Dogecoin ETFs may not attract significant investor interest. While Bitcoin ETFs have amassed over $38 billion, Ethereum (CRYPTO: ETH) funds have received less than $2.5 billion, highlighting a lack of enthusiasm for altcoin ETFs.

Dogecoin Prices May See Further Gains

Technical analysis indicates that DOGE bottomed at $0.1292 earlier this month before rebounding to $0.1925. This bounce coincided with a falling wedge pattern on daily charts, which is typically deemed a bullish reversal signal.

The $0.1925 resistance level aligns with the 50-day moving average, which has repeatedly acted as strong overhead resistance in recent months. Both the Relative Strength Index (RSI) and MACD indicators have moved downward, suggesting diminishing momentum in price trends.

A clear breakthrough above $0.2050 would confirm a bullish outlook, setting the stage for a rally to $0.2413. Conversely, a drop below $0.1292 could trigger a collapse to $0.10.

Derivatives markets are showing mixed signals. Options volume recently increased by 9.11%, with open interest hitting a monthly high of $1.87 billion. However, excessive leverage led to $3.11 million in long liquidations over 24 hours.

Moreover, whale activity has decreased, as approximately 4,000 addresses holding over 10,000 DOGE have been reducing their positions since May, indicating waning confidence among larger holders.

The price action of Bitcoin will likely continue to influence DOGE’s performance. Throughout history, altcoins have flourished during periods of strong rallies in Bitcoin. Notably, BTC has recently recovered to $95,000 from a low of $74,000.

Additionally, any potential approval of a Dogecoin ETF by the Securities and Exchange Commission could be influenced by the performance of the stock market, given the correlation between cryptocurrencies and equities over time.

Additionally, any potential approval of a Dogecoin ETF by the Securities and Exchange Commission could be influenced by the performance of the stock market, given the correlation between cryptocurrencies and equities over time.