Dogecoin Price Displays Notable Strength, Being Vulnerable to a Correction—What’s Next?

Bitcoin has regained its footing above $100K, a development that was anticipated to trigger bullish waves in the markets. While other tokens have struggled to maintain momentum, Dogecoin has demonstrated resilience, attempting to sustain an upward trend. Since the beginning of 2025, the price has made repeated efforts to surpass $0.4. Recent whale activity suggests a significant price movement, while technical indicators hint at a potential correction on the horizon.

Dogecoin Price Rally Outlook

The retail trading community often follows the lead of whales, perceiving their actions as a strong signal for future price movements. The recent increase in whale accumulation has boosted optimism surrounding Dogecoin, positively impacting its price. Whales consistently accumulated DOGE throughout 2024, pausing in November, but have since resumed and exceeded the levels seen during the 2021 bull run. Over 5000 wallets currently hold more than 1 million DOGE each, a bullish indicator.

Conversely, retail traders remain cautious, and the active address count remains within average levels. This hesitation stems primarily from technical factors that contradict the bullish narrative. The TD sequential indicator, which identifies trend reversals, remains bearish, suggesting a potential price correction. Additionally, the weighted social sentiment hovers around 0.60, indicating a lack of optimism among the crowd regarding Dogecoin's upside potential.

Technical Outlook

The Dogecoin price chart reveals attempts by bulls to sustain the bullish trend, but the rally has faced resistance at the 50-day MA. This level has provided a solid support, while the price has struggled to generate a significant rebound to higher ranges. A decline in volume has hindered the rally's progress. The incremental RSI appears to have paused the upward momentum, reinforcing the bearish outlook.

Despite the bearish signals, Dogecoin's price may challenge the bearish narrative if it manages to break above the 0.786 FIB level at $0.4 in the coming hours. This move could pave the way for a positive ascending trend, potentially reaching the 2024 high of $0.55. However, a new ATH at $1 remains a distant possibility.