Dogecoin surged to $0.39 on January 4, marking a 25% increase following Elon Musk's recent profile updates. With capital inflows outpacing the price movement, could DOGE break through $0.45?
Dogecoin opened trading at $0.38 on Saturday, January 4, climbing 25% since Elon Musk's recent X profile updates sparked excitement in the global crypto community on December 31. With capital inflows outpacing price movements, could DOGE break through the $0.40 resistance?
Dogecoin Becomes Top Gainer as Markets Respond to Elon Musk’s X Profile Update
Dogecoin has outperformed all of the top 10 cryptocurrencies this week as the global crypto markets made a positive start to 2025. Notably, the memecoin sub-sector attracted significant investors’ interest amid the ongoing rally, a move linked to Elon Musk.
Source: TrandingView
On December 31, the Tesla and SpaceX CEO changed his X profile name to “Kekius Maximus” and updated his profile picture to include a direct reference to PEPE. This fueled widespread speculation, pushing prices higher across global memecoin markets, including Dogecoin.
As shown in the chart above, DOGE traded as low as $0.31 on December 31. After Elon Musk’s profile updates, Dogecoin's price surged by 25.8%, reaching $0.39 as of press time on January 4.
DOGE Traders Deploy $790M Fresh Capital in the Last 5 Days
Although the updates have now been reverted, other key market indicators suggest that the bullish momentum in the DOGE market could persist. Significantly, data from Dogecoin derivatives markets shows that fresh capital inflows over the past week have outpaced the current DOGE price gains, pointing to further upside potential.
Supporting this perspective, the Coinglass Open Interest chart below tracks real-time shifts in capital invested in cryptocurrency perpetual futures contracts. This acts as a proxy for analyzing the directional flow of capital during critical market phases.
Source: Coinglass
As noted above, Dogecoin's open interest was $2 billion as of January 1.
Since then, it has surged by $790 million to reach $2.79 billion at press time on January 4, marking a 39.5% increase in the capital stock supporting DOGE derivatives markets.
Importantly, this indicates that the 39.5% growth in open interest has surpassed the 25% price gains recorded in the DOGE spot markets.
When open interest increases faster than prices, it signals bullish trends for two main reasons.
First, the disproportionate growth in open interest relative to spot price gains suggests increasing leverage and heightened speculative activity in Dogecoin’s derivatives markets.
Dogecoin Price Forecast: Breaching $0.40 Could Trigger More Gains
As fresh capital continues flowing into DOGE trading positions, the growing liquidity eases the path to further upside.
To amplify gains, highly leveraged DOGE traders are now incentivized to make rapid spot purchases, potentially driving prices above $0.40 in the days ahead.
Technical indicators on the DOGEUSD daily chart also support this optimistic bullish price forecast with the Parabolic SAR dots moving below current prices, amid rising volumes.
As seen below, Dogecoin price prediction hints that DOGE is positioned for further gains as it flirts with the $0.40 resistance level.
On the daily chart, Parabolic SAR dots remain positioned below the current price, signaling sustained bullish momentum.
Increasing trading volumes confirm growing market participation, while a positive volume delta indicates that buyers continue to dominate.
This creates a favorable setup for DOGE to challenge the $0.42 resistance level, with $0.47 serving as an extended target if upward momentum strengthens further.
However, the dominance of highly leveraged LONG positions poses the risk of sharp downward volatility if market sentiment shifts.
In a bearish scenario, DOGE could initially find support around the $0.36 zone — a critical level defined by prior accumulation. A steeper decline could push DOGE toward $0.34, where another significant historical buy-wall is situated.
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