Investor speculation appears to be picking up despite the ongoing risk-off environment.
October has seen little capital inflows into memecoins, with the sector’s total market cap dropping from its late September high of $37 billion to just over $26 billion. This comes alongside more than $300 billion in net outflows from the broader crypto market over the same period. So, technically, the memecoin sector’s market cap decline accounts for over 3% of total crypto outflows so far this month.
Meanwhile, the biggest memecoin, Dogecoin also had a correction above 18% over the same period. This shows that there’s really no speculative momentum in this market this month. Investors are cutting their exposure during risk-off cycles rather than rotating into memecoins for quick, short-term gains.
However, could November bring the much-needed shift in market sentiment?
The memecoins have had a strong start to the last week of October, gaining 5% in market cap as over $1 billion flows back into the sector. Dogecoin [DOGE] has gained over 10% alone. This could signal a pickup in speculative momentum, but the key question is whether this recovery can sustain into November.
Notably, this is where key on-chain signals begin to matter.
Dogecoin eyes $0.1 as memecoin momentum picks up
The growing speculative frenzy is now starting to show up in derivatives data.
According to Coinglass, Dogecoin’s 24-hour long/short ratio is once again bullish after being consistently bearish for a week. This is after DOGE broke below $0.08 that it had been holding for over 6 weeks. Whilst this may have encouraged traders to go short, it looks as if bullishness might be returning.
Structurally, a breakout from DOGE’s current range could trigger a short squeeze, potentially sending the price back toward the key $0.10 resistance level. DOGE hasn’t reclaimed this level since breaking below it in mid-May. While capital rotation into memecoins alone may not be enough to sustain a rally, on-chain metrics pointing to a potential accumulation zone suggest this pickup in speculative momentum may not be a fluke.
Nothing highlights this shift better than the chart above.
The bullish momentum across memecoins is also showing up in the DOGE/BTC ratio, which is up over 2% this week, recording its first green week in over a month. This comes as Bitcoin dominance hits resistance around 60%, and BTC breaks below $80k. Hence, this could signal an early shift away from Bitcoin and into more high risk altcoins. If this continues, then memecoins could see their moment in the sun.
In this setup, Dogecoin chopping around $0.08 could signal early consolidation, with accumulation building underneath and potentially setting up a short squeeze toward $0.10.
Final Summary
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Memecoins are showing signs of recovery as fresh capital flows back into the market.
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Dogecoin could target $0.10 if bullish momentum continues.
