Dogecoin (DOGE) price may be setting up for a breakout moment, presenting a familiar setup to the build-up seen just before its explosive 2021 rally, crypto analyst Joao Wedson.

Known for his data-driven insights, Wedson shared four key observations on why DOGE, the “king of memecoins,” could be brewing a surprise rally.

Liquidity Build-Up and Historical Pattern

The first signal is the aggregated liquidation levels. According to Alphractal’s 500-day heatmap, a significant amount of short-side liquidity, roughly $380 million, is currently being liquidated at around the $0.50 zone.

Historically, whenever short positions stack up in this manner, DOGE has entered accumulation phases, which are later followed by strong upward moves.

DOGE/BTC Pair Approaching Support

Another critical factor is the DOGE/BTC trading pair, which is nearing a long-term support level that previously preceded the 2021 breakout.

The chart shows a repeated pattern of bounces along the same support trendline, and current price action shows potential for a new reversal.

“The DOGE/BTC pair is nearing a critical support — very similar to the setup before the 2021 rally,” adds Wedson.

Meme Index and Market Conditions Align

Further bullish context comes from the Meme Index, which tracks the performance of the top 16 memecoins. The index is showing early signs of recovery following a prolonged downturn.

However, overall open interest remains low (around $3.2 billion) and daily trading volume is modest (around $12 billion). Both indicators are still in the 'underheated' condition, which could precede more volatile moves.

Market Cap Has Grown, But Speculation Remains Tame

Finally, Wedson notes that the total memecoin market cap is now much larger than in 2021, yet trader engagement is still minimal. This could create a unique setup where capital flows rotate back into DOGE.

Specifically, if momentum shifts out of large caps and into risk-on plays, it could propel smaller altcoins and memecoins like DOGE into a new cycle of speculation.

“DOGE and other memecoins could still surprise in 2025,” concludes Wedson.

With massive liquidity built up, historical support levels holding, and market conditions eerily similar to the pre-2021 rally environment, DOGE may be quietly preparing for a major upside move. For traders who are paying attention, the meme coin market’s quiet phase could be the calm before the next breakout storm.