Dogecoin Price Stabilizes After ETF Inflows Plunge 80%

The price of Dogecoin (DOGE) has entered a consolidation phase following a significant drop in inflows for the GDOG ETF, which fell by a staggering 80% overnight. While DOGE is currently struggling to maintain the critical support level of $0.15, on-chain data indicates that larger investors, known as whales, are accumulating rather than exiting their positions. This suggests that the recent pullback in price may be driven more by market sentiment than by a fundamental weakness in its structure.

After a week marked by sharp gains due to heightened interest in ETFs and renewed whale activity, the price of Dogecoin has slipped into a tighter trading range. This shift has raised questions among traders about whether the momentum seen previously is fading. Nevertheless, underlying data from derivatives, on-chain flows, and liquidity trends reveal that the potential for an upward price movement remains intact.

ETF Inflows Decline and Market Sentiment Dips

The decline in confidence was primarily triggered by the performance of the GDOG ETF. After its highly anticipated launch, inflows plunged from $1.8 million to just $365,000 overnight. By the second day, total assets reached only $2.16 million, indicating that institutional demand has not materialized as quickly as some had hoped. This rapid decrease highlights the precarious nature of interest in meme coins within regulated markets.

Investors appear to treat Dogecoin ETFs as speculative vehicles rather than long-term investments. The initial excitement surrounding the ETF’s debut has dissipated, leading to a cautious sentiment in the market. As DOGE struggles to gain traction above the $0.15 mark, traders are waiting for signs that the ETF will lead to sustained demand. The initial buzz provided a temporary boost, but the absence of consistent buying pressure suggests that stronger catalysts will be necessary for Dogecoin to break free from its current trading range.

While the short-term price action reflects a growing bullish sentiment, evidenced by a breakout above a descending trend line, there are signs that momentum may be waning. The Relative Strength Index (RSI) indicates a potential bearish divergence, and a probable crossover on the Moving Average Convergence Divergence (MACD) suggests that the price could see a pullback of between 6% to 8%. If this occurs, DOGE may test the trend line, which could act as a support base to limit further losses. Conversely, if the price remains within the rising channel, it could negate the bearish trajectory and aim for targets near $0.16.

On-Chain Metrics Indicate Continued Accumulation

Despite the recent slowdown and falling ETF inflows, the on-chain metrics for Dogecoin present a more optimistic outlook. Data shows a steady accumulation of Dogecoin among whale investors, along with decreasing exchange reserves. This accumulation trend indicates that while the price stagnates around $0.15, there is no significant selling pressure, suggesting the downturn is more sentiment-related than structurally driven.

If Dogecoin can hold its support level, and if the broader market sentiment stabilizes, this accumulation phase may set the stage for another attempt at a breakout. As the cryptocurrency landscape continues to evolve, traders will be closely monitoring these developments, especially as the potential for renewed momentum remains just beneath the surface.