Dogecoin made a remarkable comeback on November 20, regaining the $0.40 level after experiencing a 15% drop from the three-year peak of $0.44 reached on November 12. Recent price movements suggest further bullish potential as selling pressure from long-term holders has significantly decreased.

Dogecoin's Consumption Age metric has decreased significantly by 95% from last week's peak, indicating fewer long-held tokens being traded, which could pave the way for another price increase.

Market volatility surrounding Dogecoin has turned positive. The average price by trading volume (VWAP) is now lower than the market price, signaling rising short-term demand.

As on-chain trading flows indicate reduced selling pressure, DOGE seems poised for a potential price surge towards the $0.50 target.

Dogecoin is set for a further price increase following selling pressure: Can the $0.50 price target be achieved?

This recent price volatility has been driven by a combination of factors, including market sentiment surrounding political developments and changes in on-chain metrics indicating reduced selling pressure among long-term holders.

Dogecoin's bullish momentum may stem from the announcement of Elon Musk's involvement in the proposed Government Efficiency Department under former President Donald Trump.

This news has created significant excitement among investors, pushing DOGE to recent highs and contributing to a substantial 185% increase over the past month.

However, as traders begin to take profits after this price surge, the price had to adjust, dropping to around $0.37 before recovering.

An important indicator of market sentiment is the Consumption Age metric, which measures the activity of long-term holders by multiplying the number of tokens traded by the number of days since the last movement.

After the recent price surge, this index peaked at around 1 trillion DOGE as long-held coins flooded the market.

However, as of November 20, this figure has dropped sharply to only 49 billion DOGE, indicating that selling pressure has decreased by 95%.

This sharp decline suggests that fewer inactive tokens are being traded, which could lead to rapid price increases if demand continues to rise.

The average price by trading volume (VWAP) has also shifted favorably for DOGE, currently sitting above the current market price.

This indicates that short-term demand is rising as buyers are willing to pay higher prices rather than wait for market orders to be executed at lower prices.

Such behavior reflects an accumulation phase in which investors are optimistic about future price movements.

From a technical analysis perspective, Dogecoin's current price action shows promising bullish momentum.

VWAP is approximately $0.395, suggesting that most buyers are paying higher prices to maintain their positions.

The Donchian Channel indicator shows that DOGE faces initial resistance at $0.44 - the peak reached last week - while support is set around $0.29.

Breaking through the resistance level of $0.44 would signal the continuation of the upward trend and potentially reach the psychological milestone of $0.50.

Analysts are closely monitoring these key levels as they assess Dogecoin's potential trajectory.

If DOGE can maintain its position above key support levels and break through the resistance at $0.44, the price could pave the way for the next upward trend towards the all-time high of $0.73.

Conversely, if selling pressure returns and pushes the price below the support levels of around $0.29 or $0.20, this could trigger a larger correction.

Additionally, external factors such as market sentiment towards cryptocurrencies and broader economic indicators will play a crucial role in shaping Dogecoin's future price volatility.

The Fear & Greed Index is currently reflecting a reading above 80, indicating extreme greed in the market. This sentiment could lead to volatility as traders react to potential profit-taking opportunities.

While Dogecoin's recent performance suggests strong bullish potential due to reduced selling pressure and positive market sentiment, investors should remain cautious of key resistance and support levels that will determine its short-term trajectory.