Dogecoin Shows Signs of Seller Exhaustion, Fueling Bullish Optimism

As cryptocurrency prices continue to fluctuate, Dogecoin (DOGE) is exhibiting signs of waning seller pressure. Recent data suggests a resurgence of bullish sentiment, potentially leading to a significant demand increase.

Over the past six weeks, Dogecoin's price action has shown considerably less selling pressure compared to the period between mid-January and the second week of March. This slowdown in sell pressure is supported by both spot and derivatives market data. For instance, open interest rose over 5%, and options volume surged more than 200% in the last 24 hours, indicating renewed interest in the derivatives market. Positive funding rates further suggest bullish activity in the derivatives segment. Coinglass order book statistics reveal over $2.7 million in perpetual buys on OKX and Binance in the last three days, with approximately $1.38 million in large spot trades across Coinbase, Binance, and OKX during the same period.

Dogecoin Spot Outflows Reach 2025 Lows

Dogecoin spot outflows have been predominantly bearish since mid-November, coinciding with increased profit-taking after a November rally. While occasional spikes in spot inflows occurred, outflows remained dominant.

Dogecoin spot flows | Source: Coinglass

The recent low spot outflows suggest a decrease in sell pressure, creating potential for a demand resurgence. This aligns with a 90-day tariff pause, providing market stability before potential future escalations. The dip in outflows also correlates with Dogecoin's sideways price action, although questions remain regarding the extent of DOGE accumulation. Given the bearish trend since December, the prolonged downturn over the past three months likely began attracting buyers.

Dogecoin Price Recap and Analysis

While demand, particularly from large holders, remains relatively weak, it's not entirely absent. Dogecoin's price appears supported around the $0.15 level, a zone mirroring the starting point of the November 2024 rally. Since April 9th, the Money Flow Index (MFI) shows an uptick, and the Moving Average Convergence Divergence (MACD) indicator confirms predominantly positive volume.

Dogecoin price action | Source: TradingView

The MFI's increase signals accelerating accumulation near recent lows, consistent with the observed pace of price decline, suggesting a period of accumulation.

The Future of Memecoins

Prominent figures like Ark Invest CEO Cathie Wood have expressed skepticism about the future of memecoins, with some analysts predicting that the next bull market will favor utility-focused cryptocurrencies. However, Dogecoin's longevity and continued demand, along with its historical correlation to Bitcoin and its "OG memecoin" status, suggest continued relevance. Its current inability to strongly rebound likely reflects the overall market weakness and uncertainty stemming from recent geopolitical and economic events.