The past few weeks have been a time of extreme optimism in the market as the star cryptocurrency, Bitcoin, leads a strong increase nearing $100,000. This has caused a temporary shift in popular altcoins like Dogecoin, which has awakened after a long consolidation period and surged above its key resistance levels.
Since the buyers are showing some weakness, the likelihood of a sell-off has appeared, expected to provide a good opportunity as the DOGE rally has just begun a strong upward trend, projected to peak above $1 at some point in the early days of 2025.
The recent 200% price increase has helped Dogecoin reclaim the 7th position in the cryptocurrency rankings, preventing this coin from being knocked out of the top 10. A close observation shows that the bears are not completely active, indicating that market sentiment still leans towards the bulls.
Currently, the price of DOGE is consolidating around $0.42, but a slight pullback is expected to bring this level down below $0.40, which could reduce some profits in the coming days. Meanwhile, this could be seen as a good opportunity to get in as the target at the $1 mark is still activated.
While long-term trading shows a pullback may be imminent, short-term trading suggests a recovery could happen soon.
Looking at the daily chart of the DOGE rally, it shows that this token is about to touch the edge of a bullish flag. Therefore, the price is expected to remain consolidated in the flag below $0.45. Meanwhile, the MACD indicates some potential for a pullback as levels prepare for a bearish crossover with a decrease in buying volume. Additionally, the OBV also shows bearish divergence, confirming the bearish statement. Does this suggest that the bears are outperforming the bulls? Even if so, that would only exist for a short time as the price of DOGE is about to prove a surge and soon surpass the $0.50 level.
The liquidation heatmap for DOGE on Binance shows strong support levels forming around $0.397, where over $1.58 billion in long buy orders has been accumulated. If the sellers succeed in pulling the levels below $0.40, a strong recovery may occur after reaching these levels. Meanwhile, no large short positions have been accumulated above the $0.45 level, indicating a move beyond this range is imminent as market sentiment towards the Dogecoin (DOGE) rally remains optimistic.
