Dogecoin (DOGE) is firming up at key technical support levels. It is presently above the weekly chart’s Ichimoku cloud. It is forming a bullish hammer candle that is reinforcing the confidence of the buyers.
Both the 100-week and 200-week simple moving averages (SMAs) serve as robust support levels. Indeed, the 100-week SMA has moved above the 200-week, a golden cross that may point towards a durable change in direction.
This convergence of support areas and bullish-looking candlestick patterns provides the market grounds to watch closely. Few in the market believe it now, but these signals tend to show up ahead of significant movements. Skepticism, itself, can be a fuel.
Dogecoin recently dropped into the 50%-61.8% Fibonacci retracement zone. This area has acted as a strong support in past cycles. After hitting highs near $0.48, the price has retraced and now trades near pre-election levels. The market has erased those previous gains, but the current pattern tells a different story.
For nearly a month, DOGE has moved sideways around $0.16. This points to a reaccumulation phase. The Relative Strength Index (RSI) has bounced from oversold conditions, hinting at bullish divergence. It’s subtle but meaningful.
Dogecoin price action shows short-term volatility
However, the statistics support this assessment. The number of wallets that contain more than 10,000 DOGE increased to 240,000, reaching a six-month high. Mid-size holders and whales are returning to the scene, and their behavior is likely to precede market direction.
In spite of a recent dip of 2%, Dogecoin remains firm. These dips may be regarded as temporary volatility. The bigger picture is in favor of the imminent breakout. DOGE’s Q1 2024 price structure had also displayed similar indications before going on to rally to $0.22. Such a rise was swift and followed a protracted bout of inaction.
A bounce back of that vigor is feasible. Liquidations in Q1 were over $3 billion. That excess is yet to be absorbed. When it passes, the market might have room to breathe and mobilize.
If the trend continues, DOGE may surprise. High risk is present, yet high reward is also there. For now, everyone is waiting to see if the consolidation resolves higher.
Nonetheless, the graph appears to be in position. The numbers validate it. Sentiment is cold. Oftentimes that is the prelude to something significant.
