Dogecoin (DOGE), the prominent meme cryptocurrency, is experiencing a substantial rally.
Recently peaking at nearly $0.17, a level last seen in early June, the coin has surged to a nearly five-month high, reflecting an 18% gain over the past 24 hours.
DOGE’s rise has been fueled by a combination of factors, including technical momentum, increased derivatives interest, and notable political endorsements.
Together, these elements have set DOGE on a promising upward trajectory, capturing the attention of traders and investors alike.
Elon Musk’s influence on Dogecoin’s rally
The latest price surge appears to be closely linked to Tesla and SpaceX CEO Elon Musk. Musk’s support for Trump’s re-election bid has fueled speculation that Dogecoin might play a role in a Trump administration, should he win.
In a recent hint, Trump suggested a potential role for Musk in his administration, overseeing a proposed Department of Governmental Efficiency (D.O.G.E.), a name that strikingly mirrors Dogecoin’s ticker.
This unexpected connection has reignited excitement and speculation around Dogecoin, adding fuel to its price momentum.
The proposed Musk-led department has sparked enthusiasm, especially after Musk claimed that such a department could save the U.S. $2 trillion annually.
Following Musk’s endorsement and his post featuring a DOGE avatar, Dogecoin’s price spiked, with many attributing the surge to Musk’s apparent ties to the token.
Derivative data signals high market activity
DOGE’s derivatives metrics further highlight the robust trading interest around its rally. According to Coinglass, over the past 24 hours, Dogecoin futures trading volume surged by 28%, while open interest grew by over 34% to reach $1.48 billion, signaling aggressive trading activity.
Additionally, options volume spiked by 138%, reflecting substantial speculative interest in the derivatives market. Although options open interest dipped by 23.68%, likely due to profit-taking by some traders, overall bullish sentiment remains strong.
The long-to-short ratio currently stands at 1.1422, with Binance’s top traders showing an especially bullish stance, as seen in a long-to-short ratio of 2.3847.
Liquidations have also impacted short positions significantly, with $2.39 million in liquidations recorded in the last hour, mostly from traders betting against DOGE’s rise. This trend underscores the strong bullish appetite as DOGE continues its ascent.
On-Chain activity reinforces bullish sentiment
Dogecoin’s on-chain data adds further support to its bullish outlook. Over the past six months, active DOGE addresses have increased, reaching 84,306 as of October 2, according to data from Santiment.
This heightened network activity signals sustained interest in Dogecoin, aligning with the broader upward trend observed in recent weeks.
Analyst Martinez notes that this on-chain growth could signal further price gains, with some predictions suggesting that DOGE may be on track for a 180% surge if the current momentum holds.
Outlook: Dogecoin’s potential and the road ahead
DOGE’s remarkable rally, fueled by Elon Musk’s renewed involvement, has reignited interest in the token’s long-term potential.
Many traders and analysts are forecasting DOGE to reach new heights, with some speculating on the possibility of a $10 target. The combination of high derivatives interest, Musk’s endorsements, and on-chain data point to a potential rally ahead.
As Dogecoin’s journey unfolds, attention remains focused on Musk’s next moves and the potential political implications surrounding the D.O.G.E. proposal.
Featured image:
Alfernec – October 29, 2024. Digital Image. Shutterstock.
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