Will Dogecoin Start Its Big Rally After 70% Weekly Gain?

The price of Dogecoin (DOGE) has experienced a significant increase of approximately 70% this week, fueled by a bullish trend in the cryptocurrency market. This suggests that the momentum will point to further gains in March, based on a mix of technical and fundamental indicators.

Dogecoin whales collect

Dogecoin's recent price increase comes as DOGE holdings are rising among its investors, also known as “whales”. For example, the number of addresses with more than 100,000 DOGE tokens has increased by 0.7% since the beginning of the year.

At the same time, the number of entities with a balance of more than 1 million DOGE has seen a slight dip since February 12.

Given the large holdings, these addresses may represent exchanges, suggesting that traders are holding DOGE rather than actively trading. This feature shows the presence of a strong stock.

Memecoin mania before the halving of Bitcoin

Dogecoin's price increase is seen ahead of the fourth Bitcoin halving scheduled for April 19, 2024. Interestingly, this price rally is similar to previous Bitcoin decline events in May 2020 and July 2016.

Specifically, DOGE's price rose 200% from the first Bitcoin halving, and roughly 50% ahead of the second, as shown below.

Generally, traders look to alternative investments like memecoins for high short-term gains, assuming that the halving will boost the overall market. This behavior is due to the desire to take advantage of the increased market activity associated with speculation and Bitcoin supply shocks.

Related: Solana Rockets 13% to New Yearly High, Led by WIF Memecoin Frustration

Like Dogecoin, other top memecoins including Shiba Inu (SHIB), Pepe (PEPE) and Bonk (BONK) saw huge gains in the days leading up to the Bitcoin halving.

DOGE price technicians are hinting more upside

As shown below, DOGE's next upside target appears to be at the 0.236 Fibonacci retracement line.

This price point was a fundamental support indicating a crucial role in the market during the downtrend from May 2021 to November 2021. Once it breaks into resistance in December 2021, this limit becomes a serious obstacle. To this day, it has maintained its importance as a key point of defense.

Heading into March 2024, Dogecoin is on track for a 25% rally to reach $0.18, aided by strong buying sentiment in the memecoin platform. This optimism suggests that Dogecoin may hit its target by the end of the month.

This article does not contain investment advice or recommendations. Every investment and business activity involves risk, and readers should do their own research when making a decision.