After four weeks of consolidation, Dogecoin (DOGE) has been fluctuating between $0.35 and $0.48.
Recently, the price broke above the uptrend line, showing a possible bearish signal.
However, some analysts believe that despite DOGE’s 16% drop this week, it may actually be preparing for a new uptrend. The RSI overbought signal has been reset, which could pave the way for a breakout above $0.50.
Meanwhile, DOGE’s liquidity may fluctuate between $0.32 and $0.34, but in the long run, the bullish trend remains. Therefore, investors should remain vigilant and do more research on their own.
Dogecoin broke out 208% in early November, after which it consolidated in the $0.35 to $0.48 range for four weeks. The recent price correction broke the rising trendline, suggesting a possible bearish risk.
However, analysts believe that combined with some key technical indicators and trends since March 2024, Dogecoin may be preparing for a new round of increases.
Dogecoin’s Uptrend Could Happen ‘At Any Time’
Although Dogecoin is down 16% this week, cryptocurrency analyst Trader Tardigrade noted that Dogecoin’s daily RSI overbought signal has been reset.
Overbought conditions in the RSI often mean that traders are likely to sell, causing prices to fall in the short term.
Previously, a strong uptrend was seen on Dogecoin’s daily chart when the RSI fell back to 50 in March 2024. Based on this chart, analysts believe that the possibility of Dogecoin breaking through $0.50 could happen “anytime” in the next few days.
According to data from Santiment, DOGE’s “average age in USD” is currently sending bullish signals. In fact, the average investment period for cryptocurrencies has dropped by 31% in just eight weeks, meaning that some long-dormant tokens are returning to circulation.
A post on the platform X mentioned that past bull runs — whether in 2017 or 2021 — would not stop until the average age of these assets became "older" again.
In terms of DOGE’s liquidity, it is likely to fluctuate between $0.32 and $0.34
Although the trend remains bullish in the long term, Dogecoin may fall and collect liquidity in this range before continuing to climb to higher prices. In the near term, DOGE's low was hit at $0.365 on November 26, but deeper liquidity support remains between $0.34 and $0.32.
A similar situation occurred in March 2024, when liquidity lows were near $0.12 and $0.10, and DOGE rose again after a pullback, continuing the upward trend.
A key observation is that the current price is testing the 50-day moving average, and the RSI has fallen back to the 50 level (as shown in the figure). In addition, similar technical signals have also appeared, including a bearish engulfing pattern on the daily chart and a breakout of the rising trend line below. These signals show that the current market structure has strong similarities with previous movements.
Therefore, it is expected that Dogecoin may test the 50-day MA again before the next bullish rally and the price may pullback to the $0.34 or $0.32 range.
